Saturday 4 June 2011

Economic news is bad for Obama’s reelection bid

Obama and House Speaker John Boehner (R-Ohio) will play golf together on June 18th in what will be an opportunity for the two men to hammer out their differences on the debt ceiling and other issues.

Both the White House and Boehner's office confirmed the planned round of golf to CBS News. The White House said Mr. Obama extended the invitation -- and the House speaker accepted.

The location of the round - as well as who will fill out the expected foursome - has not yet been decided.

CBS News White House correspondent Mark Knoller reported on May 30 that Mr. Obama had played 70 rounds of golf as president. Boehner also regularly hits the links.

Boehner gas called on Mr. Obama to get personally involved in working out a deal on raising the debt ceiling, which the government says will be crossed on August 2 without action. Republicans, led by Boehner, want spending cuts larger than the increase in the debt limit in exchange for yes votes; Democrats say not raising the debt ceiling would have catastrophic consequences.

Behind the economic distress is a series of unexpected events, including the earthquake and tsunami in Japan, the European debt crisis and rising gasoline prices. As a result of the unemployment rate turning back up and the housing market reaching new lows since the slump began in 2006, numerous economists have reduced their expectations for economic growth this year.

Even more challenging for Obama is that some of the hardest-hit states, such as Florida, Nevada and Michigan, are critically important for his reelection strategy.

Democrats believe the auto bailout can be a big political winner in the industrial Midwest. But the administration has struggled to show progress in helping struggling homeowners.

And White House allies concede that the economy may present greater challenges than they had thought.

“The president is going to be running for reelection in an economy that’s still too weak,” said Jared Bernstein, who until last month was chief economic adviser to Vice President Biden. “It is improving and is in a far better place than it was when he got there but still is not adequately lifting the living standards of the broad middle class.

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