White House

Wage stagnation, long-term unemployment undermine rosy numbers.
By Edward-Isaac Dovere
12/23/14 6:58 PM EST

President Barack Obama will use his State of the Union address to roll out an agenda aimed at tackling stagnating wages and helping Americans who feel left out of the economy’s surge, and he’s planning to use the first few weeks of January to travel the country promoting a new economic message.

The White House planning reflects a dilemma for the president on the economy: With the Dow breaking 18,000 on Tuesday, buoyed by the fastest gross domestic product growth in more than a decade, Obama wants to tout the bigger picture successes without looking insensitive to people who are still struggling. Yet he doesn’t want to ignore the bullish data and miss an opportunity to tell the story of the American economic recovery.

Changing Americans’ sense of the economy is Obama’s critical project for the next two years, and he and his aides know it. His own legacy depends on it — neither health care, immigration reform, opening an embassy in Cuba nor anything else is going to add up to much if most people feel like they’re worse off than the day of his inauguration.

Analysts agree that improving Americans’ sense of the economy is the single most important thing Obama can do for Hillary Clinton as the presumptive Democratic nominee: Whether she wins will most likely hinge significantly on whether the “Obama-Clinton economy” is a positive Democratic slogan or a snide Republican talking point.

But for now, the growing pile of economic data that Obama and his aides believe demonstrate his success digging the country out after the financial collapse hasn’t broken through, and they know it. Wages haven’t kept up, prices keep rising, and Obama seems to be presiding over a period in which Americans’ lives are getting more difficult.

“You can’t convince people that their paycheck is going farther than it was — and you shouldn’t try. That would be a big mistake. What you can do is try to affect people’s optimism for the long term,” said a senior Obama adviser. “If we can make people understand that there are reasons for a bright future and the president has a plan to address what ails them, then that will be real progress.”

Ideas are still being proposed, vetted through the budget process, nixed and reworked for the State of the Union. But already, White House aides are starting to see some preliminary proposals that they believe will break through to talk about and show where economic progress is taking hold, and trying to spark what they like to refer to as a serious debate about issues middle-class families care about, with possible initiatives ranging from early childhood education to housing.

But Obama won’t have much time immediately after the Jan. 20 speech to press the message himself. Only a few days after he addresses Congress, he’ll head to India for a number of events with the new prime minister.

Obama aides continue to point back to the speech he delivered at Northwestern as a guide for what’s ahead — “a new foundation,” with “cornerstones” that include investments in the energy, tech and manufacturing; education and job training; health care reform; and structural overhaul.

On the Hill, they’re less interested in high-minded talk of principles than clear legislation, with particular emphasis on the corporate tax reform and trade deals that Obama and his advisers have for months identified as their best chance for striking deals with Republicans.

“He has every right to go out and talk about his message. But he ought to spend more time up here, working with Democrats and Republicans alike on passing items that will actually help improve the wages of middle-class Americans and provide more opportunity for growth in the economy,” said Sen. Rob Portman (R-Ohio), who’s met privately with Obama and offered himself as a bridge for bipartisan economic deals.

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