Imagine if you had told President Obama one year ago that he’d end 2013 with dismal poll numbers and a “Lie of the Year” award—from the supposedly liberal mainstream media—to display next to his Nobel Peace Prize. Fresh off a convincing reelection victory, he probably would have dismissed it as mere Republican propaganda.
Obviously it isn’t. Obama had perhaps the worst year of his presidency in 2013, due largely to the disastrous launch of his healthcare reform plan and his now-disproved claim that “if you like your healthcare plan, you can keep it.” The president’s approval rating, around 43%, is nearly the lowest since he was elected. Voters say they’re more likely to vote for a Republican than a Democrat in the 2014 midterm elections, which could solidify Republicans’ control of the House and flip control of the Senate to Republicans as well.
But the midterms are still nearly a year away, and it could turn out to be a much better year for Obama and his fellow Democrats than 2013 was. For starters, the economy has considerable momentum going into 2014, whereas one year ago it was hobbled by the “fiscal cliff” showdown, which resulted in tax increases and spending cuts that curtailed growth throughout 2013.
“For the first time in several years, we approach the new year with no major cloud on the horizon,” Bank of America Merrill Lynch economists wrote in their preview of 2014.
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The pace of job growth in 2014 finally seems likely to accelerate. Job growth hasn’t been terrible, with the economy creating 7.5 million jobs, or about 207,000 per month, since hiring bottomed out early in 2010. But the economy backpedalled in 2013, with a sub-par 186,000 new jobs created each month, on average, and rampant economic uncertainty caused by antics in Washington and confusion over the Federal Reserve’s stutter-step pronouncements on monetary policy.
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At least some of that confusion has been replaced by more optimism about the future.
“We see a lot more certainty for 2014,” International Monetary Fund Managing Director Christine Lagard said recently. “That gives us a much stronger outlook.” Here’s what has changed: A robust housing recovery is now underway, which could soon spread to a lot of first-time home buyers who have been sitting on the sidelines with their cash in a lockbox. The recent budget deal in Washington accomplished the minimum essential task of keeping the government open in 2014 and paying most of the government’s bills. And the Federal Reserve finally turned the corner and began to roll back “quantitative easing” after months of head fakes and hand-wringing; the news sent financial markets up rather than down, suggesting that fear of a rollback was worse than the rollback itself.