By Brian Summerfield, Online Editor, REALTOR® Magazine
In the heady days surrounding the 2008 election, there was a national mood of pride and hope. The largely positive official campaigns run by Barack Obama and John McCain, and the victory of the former, engendered in the American people a sense of optimism about the future, even as the country continued to sink into a severe recession.
Today, those feelings are mostly gone, having been dissipated by public perceptions of stalled recoveries in jobs and housing and government getting more expensive and intrusive, said former Florida Governor Jeb Bush, who spoke at a Tuesday morning session during the Mortgage Bankers 2011 Convention & Expo in Chicago. Bush was joined by David Axelrod, President Obama’s chief political advisor, who added that concerns about corruption and incompetence on Wall Street were fueling the fire.
“There’s a dark cloud over our country,” Bush said. “The hope and optimism that Obama brought to the country in 2008 have been replaced by despair. I think any incumbent in 2012 will have a tough challenge.”
Of course, the Republicans have their own challenges. The party is divided right now on ideological grounds, Axelrod pointed out. “The Republican party of the past was a more organized, hierarchical party,” he said. “It’s different now. You’ve got the Tea Party and the Martini Party.”
Bush acknowledged that the GOP was a bit fragmented, with libertarians, social conservatives, and defense hawks jockeying for primacy. However, he predicted that when the primary ended, these groups would unite behind the candidate. “I think you’ll see the end of this fracturing,” Bush said. “The overriding fear will be of a second [Obama] term.”
Because of the public mood and political circumstances right now, Bush predicted that the campaigns would be rancorous, with both sides pursuing a “win ugly” strategy. The Republican candidate, whoever that may be, will constantly reinforce that the president’s economic policies have not worked, without focusing too much on policies that he or she would put in place if elected. On the other side, Obama will probably argue that if the opposition had been in charge, things would be much worse today.
That’s a shame, Bush added, because the election should be about the future direction of the country, not a “food fight” over which candidate or party is worse. “I’m not optimistic that this is going to be about long-term solutions for the country, as much as I’d like that,” he said. “The natural inclination is to create doubt about the other side’s weaknesses. There’s going to be a lot of spending by independent groups. You’re really going to have to like politics to watch [the political campaigns] on television.”
Both Axelrod and Bush agreed that economic issues would dominate the election, but differed in how they would address those issues. Axelrod argued that several underlying economic problems extended well beyond the financial shenanigans of the past few years, going back decades in some cases. Irresponsible policy decisions, highly partisan politics, and macroeconomic trends that have caused middle class wages to flatten or even fall since 1970 contributed to the current climate of fear and mistrust in political and business institutions.
In this environment, the most critical thing is to restore the public’s trust in those institutions through sound policy. That’s why it’s crucial to keep recent financial reforms — such as those contained in Dodd-Frank — in place, Axelrod said. “The American people need assurances that the financial sector will be run transparently and fairly,” he explained. “I think the most important thing we can do is make sure consumers know what they’re buying. That means no hidden fees or penalties. Whatever is being charged should be charged in the open.”
Axelrod added that “we have to end Fannie and Freddie as we know it, but we have to do that transition in a way that’s not disruptive to the market.”
Bush said the problem with respect to the economy is not so much policy as messaging. “My view is markets work much better than they’ve been given credit for recently,” he explained. “There’s real hostility toward businesses in America today. In those kinds of situations, most businesses go into the fetal position and hope it will just go away. But you have to defend your position in the marketplace of ideas. If you’re not out there dealing with these issues, you can expect to get beat on.”