GlobeSt Viewers Doubt Obama, Question Recovery

NEW YORK CITY-We asked and you told us. President Obama’s stance on businesses hasn’t exactly endeared him to GlobeSt.com’s viewers. Eighty-seven percent of respondents to our latest online poll agreed with the statement that the president “has no clue that this is a capitalist country.” Only 13% would consider Obama “the entrepreneur’s personal savior.”

In that view, readers likely find themselves siding with GlobeSt.com blogger Joel Ross, who wrote earlier this month that Obama and House Speaker Nancy Pelosi “have created a regime which is filled with people who are truly anti-business, pro labor, anti wealth creation.” Ross cited Obama’s appointment of Elizabeth Warren to head the new Consumer Financial Protection Bureau, which Ross called “the ultimate example of the regulatory zeal which will ultimately harm the economy. The way he appointed her this week is further proof that Obama doesn’t care what is best, he only cares to advance his agenda.”

There’s been a lot of skepticism about the current administration among GlobeSt.com’s readers. Along with the poll on Obama’s attitude toward business, readers have sounded off on other poll questions related to the economy and Washington’s handling of it. Specifically, 76% say that a double-dip recession is “right around the corner,” while in another poll, a plurality (50%) dispute that the Federal Reserve’s efforts have helped the market, agreeing that “nothing good ever came out of Washington.”

To Ken McCarthy, Cushman & Wakefield’s managing director of research for the New York region, the sentiments reflect anxiety about how strong and sustainable the recovery really is. He tells GlobeSt.com he doesn’t think a double-dip is likely, and he credits the Fed with containing what could have been a more disastrous downturn than actually occurred.

Still, he says, “At the beginning of this year, we had some healthy growth, employment had picked up substantially, GDP was growing and then all of a sudden we saw this second-quarter slowdown. I don’t want to call it a stall, because we are still expanding and adding jobs, but it wasn’t at the pace we had anticipated coming out of the first quarter.”

As a result, says McCarthy, “There’s a high degree of anxiety about this: ‘Is it sustainable? Are we going to go back down?’ That’s what’s being reflected in the commentary and the criticism."

Highlighting the sense of uncertainty was last week’s declaration by the National Bureau of Economic Research that the Great Recession had ended in June 2009. That brought widely-reported exclamations of disbelief by everyone from jobless Americans to Warren Buffett, and Obama said that for the millions currently out of work, the recession was “still very real.”

McCarthy says that kind of skepticism about the NBER’s pronouncement is understandable. While there has been a shift from the economy contracting to expanding once again, “that’s a lot different than saying things have improved. It’s a directional call as much as anything else. What people are concerned about is that since then, it doesn’t feel like much has improved.”

The depth of the recession also has colored people’s perceptions. “This wasn’t a mild recession; it was a severe downturn, the unemployment rate reached10% and we’re still at 9.5%,” says McCarthy. “When you have that much decline in activity, to then have a modest recovery just doesn’t feel right.”

However, he notes that the recovery has been similar to what we saw in the early 1990s and the circa-2001 downturn. “Believe it or not, this recovery has generated job growth more quickly than the last two recoveries,” McCarthy says.

He calls a double-dip “unlikely. Once the economy begins to pick up, it does gain a certain momentum. We’ve seen demand increase and in fact, despite the slowdown in the GDP in the second quarter, domestic spending actually increased at a faster rate than in the first quarter.” He adds that you’ll find a story of “recovery at a steady, moderate pace” when you dig deeper than the headlines.

The Fed is due at least some of the credit for that, in McCarthy’s view. “You were in the middle of the worst economic crisis this country has faced since the 1930s,” he says. “The Federal Reserve used every tool in its arsenal to make sure that the financial system remained solvent. Clearly, they succeeded. I can’t think of anything more they could have done.”