Why Obama Lost

It’s not just the bad economy.

Confronted with devastating losses in last week’s midterm elections, President Obama has resorted to a familiar Clinton-era theme to explain his party’s recent trouncing: It’s the economy, stupid.

In an interview with “60 Minutes” this weekend, Obama insisted that last week’s historic loss of at least 60 House seats was a “referendum on the economy” rather than a vote of no-confidence on the agenda set by his administration and the Democratic Party. That is a convenient explanation for the administration and Congressional Democrats, avoiding as it does any sustained reckoning with the public’s rejection of their policy agenda. It’s also demonstrably false.

There can be little doubt that last week’s mass eviction of House Democratic incumbents was punishment for the policies of the past two years. Indeed, the voters themselves said so. According to exit polls, 37 percent of voters said that they were casting voting in opposition to the Obama administration’s policies. The backlash was especially forceful against three issues that have defined the past two years of Democratic rule – the growth and increasing activism of the federal government; the ballooning deficit; and the health care overhaul. On each one, the public overwhelmingly rejected the Democrats’ approach.

While the economy has continued to lag, the Obama era has been a boon for Big Government. Federal non-defense spending under Obama has hit record levels, surging by 21.4 percent in the past two years. The Congressional Budget Office reported that as of September, the U.S. government has spent $3.45 trillion, a spectacular sum second only to the $3.52 trillion that the government spent in 2009. Unremarkably, voters have viewed this government expansion with alarm. In exit polls, 56 percent said that that the government is doing too may things that should be left to private business and individuals.

The predictable consequence of Big Government – a massive deficit – highlights another sharp disconnect between the Democrats and the voting public. On the back of big-spending measures like the $859 billion stimulus program, Obama in his two years in office has swelled the deficit to $ 2.7 trillion. Given their chance to render a verdict on the wisdom of Democrats’ deficit spending, the public voted for a new way forward. Exit polls showed that 39 percent of voters considered reducing the budget deficit as their top priority in the election.

Then there is ObamaCare. Already unpopular at the state level – some 21 states are suing the federal government over the legislation – it proved a loser nationally. According to national exit polls, 48 percent of voters surveyed wanted Congress to repeal the legislation.

It is true, of course, that concerns about the economy played a role in the election. With unemployment stuck at 9.6 percent and growth below expectations, the slow pace of economic recovery undeniably was a factor in the Democrats’ defeat. But to suggest, as President Obama has, that the election was solely a verdict on the economy is to miss the large extent to which the very policies that voters rejected last week contributed to the poor economic climate.

For instance, under the guise of the economic stimulus package, the Obama administration handed out $145 billion in aid to state and local governments – in effect, a taxpayer subsidy for the unsustainable pension benefits of public sector employees and precisely the kind of Big Government bailout that voters opposed. And despite Democrats’ arguments that deficits were necessary to achieve economic growth, the public remains unconvinced. If voters have rallied against the administration’s spending spree, it’s because they see that what was sold to them as essential to jumpstart the economy has not only not done so but it may have delayed the promised recovery.

For a specific example, one can look at Obamacare. Economists have repeatedly pointed out that the legislation is a drag on the economy. With its employer mandates and heavy compliance costs, it imposes onerous burdens on small businesses that deter hiring. President Obama may wish to pretend that voters’ economic discontent is unrelated to his agenda, but the evidence suggests that it is very much one and the same.

And therein lies the major problem with Obama’s post-election spin. If he refuses to recognize that his policies have contributed to the Democrats’ electoral disaster, there is no way for his administration to correct course. With GOP control of the House, at least there is a check on his legislative ambitions. What there does not seem to be is any awareness on the president’s part about the role that his policy agenda played in the facilitating that outcome. To put it another way, it’s the policies, stupid.