Monday, March 23, 2009

Outrage Over AIG Bonuses Not (Yet) Hurting Obama's Approval

Nate Silver over at FiveThirtyEight has an analysis of the president's still-solid approval rating, even since last week's AIG salvo. He points out Gallup's number (65) has actually went up since the public first learned of the AIG bonuses. Rasmussen's daily number (56) is down just one point. The truth is likely somewhere between the two.

While Americans have been monitoring the situation closely, they don't blame Obama and his administration..yet.
Instead, they blame AIG itself, and may see Obama as being as much of a victim as a co-conspirator. We should keep in mind that, among the 95 percent of the population that does not follow politics especially closely, what they've seen is Obama expressing some (tempered) outrage about the bonuses and saying he'll do whatever he can to recoup them...The perception is that AIG broke the rules, not (as is actually closer to the mark) that the rules were inadequately written.
Whether or not the general public feels the same way next week or next month remains yet to be seen. Obama clearly cannot sustain these numbers if the daily headlines continue to inform Americans of more bailouts.  A recent NYT's article, for instance, claims that Obama will disclose a plan this week to purchase $1 trillion in bad debt.  Update:  See the plan here in Geithner's own words.
This is not to suggest that there aren't longer-term risks for the White House. Any further actions that are perceived as a "bailout" will now require more political capital, and may in fact be entirely impossible. This may come to a head this week, as further details emerge about Treasury's bank rescue plan, which is so far receiving almost uniformly terrible reviews.
On the other hand, this recent pitchforks and torches war against the rich could be beneficial to Obama.

We shouldn't forget that Republicans (true or not) have long had the reputation of protecting fat salaries of the rich with loopholes and taxcuts. It'll be a tough sell for the GOP if they attempt to blame Democrats of selling their souls to those benefiting from the AIG bonuses. And given the fact that 85 House Republicans voted with Democrats to tax AIG bonuses at 90%, it may be easier for Obama to use those votes as leverage to repeal the Bush tax cuts down the road. Silver continues:
Populist sentiment, ultimately, may prove to be both the greatest asset and the greatest risk to the Administration as it tries to enact its agenda. Can the Administration rely on the populist vanguard to shift the Overton Window on matters of class? Or will the broad-based left-of-center coalition that elected Obama cleave itself into halves, making it harder for the Administration to achieve political consensus?

One thing's for certain: populist sentiment, whatever the Administration chooses to make of it, is no longer something it can afford to ignore.

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