The New New Deal | Michael Grunwald

Summary of: The New New Deal: The Hidden Story of Change in the Obama Era
By: Michael Grunwald

Introduction

Immerse yourself in the fascinating world of ‘The New New Deal: The Hidden Story of Change in the Obama Era’ by Michael Grunwald, which explores the American Recovery and Reinvestment Act of 2009 and its long-term implications on the US economy. While often criticized for its limited short-term impact, Grunwald’s book highlights its importance in laying the groundwork for lasting change across four main pillars: energy, healthcare, education, and the economy. The book also delves into the political and media landscape that led to public misconceptions about the legislation.

Rethinking the American Recovery and Reinvestment Act

The American Recovery and Reinvestment Act of 2009, which was meant to stimulate a struggling US economy, is often viewed as a failure by many. However, this perception is only due to its portrayal as a short-term aid package. The Act’s longer-range aspects, including reinvestment, are the result of years of policy proposals and ideas. These long-term engines will transform the US economy, fulfilling President Obama’s vision for change. Obama’s administration aimed to address the country’s crumbling infrastructure, increasing bankruptcies, and falling wages. While the Act’s $831 billion size was an indicator of the nation’s crisis-driven financial damage, there is ample evidence of its quick-fix successes. Overall, the Act’s impact should not be judged solely in the short term, as it will take years to develop.

Obama’s Four Pillars

In his first presidential campaign, Obama focused on four critical concepts that he named “The Four Pillars.” These pillars were essential to America’s progress, and he believed the nation needed to work towards them to move forward. They include energy, healthcare, education, and the economy. According to Obama, dependence on foreign oil, the lack of preventive healthcare, and inadequate education were holding the country back. He advocated for clean energy, a cap-and-trade emissions program, smart grids, and alternative energy investments. For healthcare, he wanted to modernize the industry with technology for doctors’ records, competitive effectiveness research, and best practices. Education required accountable schools, new teacher training and evaluation methods, as the status quo was not serving America’s youth. He also believed that ending the Bush tax cuts would generate much-needed funds for necessary programs, deficit reduction, and help close the income gap. Obama’s vision for the nation centered on these four pillars and believed they could lead America to a better and more prosperous future.

Obama’s Approach to Economic Recovery

Obama’s economic team faced a huge challenge when they took office during the Great Recession. The team sought a temporary stimulus to promote immediate demand, but soon realized a more significant solution was required. With staggering job losses, low retail sales, and widespread home foreclosures, they proposed a massive aid package. Obama urged his staff to be bold, and they created programs like Cash for Clunkers, the Making Work Pay tax cut, and a plan to start a national smart grid. Obama’s plan drew inspiration from FDR’s New Deal, which transformed the US economy in the 1930s. However, the short-term job-creating projects that worked then aren’t feasible now. Obama’s team needed to focus on longer-term, skilled-work solutions, as the country’s economic woes were gravely more complex.

The Recovery Act: What it Entailed and Why it Faced Resistance

The proposed Recovery Act by the Obama administration included a range of stipulations aimed at providing tax cuts, subsidies, and safety net benefits. However, due to the virulent resistance from the Republicans, the proposed legislation faced numerous challenges. Republicans campaigns to reject the Obama proposals, giving special attention to even minor initiatives that benefit the public. Nevertheless, the Recovery Act was instrumental in resolving issues such as homelessness, restructuring unemployment insurance, providing incentives to businesses promoting environmentally responsible actions, and creating high-speed rail infrastructure. While the Obama administration aimed to provide a complete structure of economic growth, the Republicans blocked the stimulus bill, further highlighting the political divide prevalent in government.

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