It’s not his fault. And it’s not for lack of trying. But he’s dealing with a stacked deck.
For decades, the cornerstone of the US economy has been durable goods, driven primarily by housing starts. In other words, our economy has depended mostly on housing construction.
For example, in 2004, more than 2 million home-building permits were authorized nationwide. In 2005, the number had risen to more than 2.1 million. Then in 2007, the number dropped to less than 1.4 million. By 2009, the number was just 583,000. And even though the number increased to more than 604,000 last year, you can see that it’s only slightly more than a third of the annual building permits from just prior to the Great Recession! And half the number in 1959!
Now think of what those numbers mean. Each of those permits requires building contractors, carpenters, electricians, plumbers, roofers, sheet rockers, flooring contractors and more. In addition, the homes need new appliances, furnaces, air conditioners, cabinets, light fixtures, plumbing fixtures, garage doors, etc.
Get the picture?
When the financial giants swindled billions from American homeowners, they destroyed confidence in homeownership. And, as the same crooks are now disposing of their inventory of foreclosed homes, they are driving down home prices which puts more homeowners in foreclosure and prices drop even farther. The end result is massive unemployment. And, if you’re unemployed, what’s the last thing you’re going to do? That’s right. The last thing you want to do is buy a home.
So what’s a President to do after the real estate industry has been driven off a cliff? The problem certainly wasn’t of President Obama’s making. Indeed, his administration has done Herculean work getting things moving back in the right direction. But he needs to do more. He needs to push for additional stimulus that will create more jobs which will encourage more people to buy homes which will create even more jobs.
But don’t hold your breath. Because, in addition to the GOP (Grand Obstructionist Party) in the Senate, he’s now faced with a Republican/Teabagger majority in the House. And all of them are determined to deny him another term in office.
If you think you hear the faint strains of Nero fiddling, you can be certain that he’s now a Republican.