But if we may offer the President some friendly advice, his real challenge in a second term isn’t the Republicans. He’s beaten them like the Washington Wizards. … It’s his economic growth deficit. …
Now look at Mr. Obama’s first term. His average annual growth rate so far over his four years is 0.8%. Take out the negative growth of 2009, and it is still only 2.1% a year. Mr. Obama’s great challenge for the next four years is leaving behind this Japan-like stagnation and getting the economy back to the growth of the Reagan and Clinton eras.
Without 3%-4% growth, Mr. Obama will never get middle-class incomes back to what they were even in 2007. Without faster growth, he’ll never raise enough tax revenue to reduce his trillion-dollar deficits, much less finance ObamaCare. Without faster growth, he’ll be forced to choose between cutting entitlements, raising taxes again, or facing a debt crisis that may not wait until 2016.
With that in mind, Mr. Obama might want to think twice about those Democrats who say don’t worry about raising taxes or going over the tax cliff because he and they can always blame the Republicans. The truth is that any recession, even a short one, would steal another year of growth from an economy that is barely growing as it is. And once a recession starts, no one can predict how deep it would be or how long it would last. To adapt Jack Kennedy’s famous phrase, an ebbing tide strands all politicians.