Ignoring for now the ridiculousness of their claims, it this a good idea politically?
Up until now his saving grace has been to blame everything on Bush. While this has mostly been a patently indefensible position, he has been able to get the fringe media to buy into it and support his stance.
What happens now though if the economy tanks again? There are many economists that think the worst is not over yet and there is plenty of evidence that we may not be out of the woods.
Unemployment is not improving significantly and is even having months in which it worsens. Further there is a strong indication that while the unemployment rate has dipped, it is because a large part of the unemployed have stopped looking for work, which is not reflected in the official unemployment rate.
A significant proportion of the jobs "created or saved" have been temporary, government funded or actual government jobs. With decreased tax revenues to the federal government and states these jobs are not sustainable and will be lost once the current funding is exhausted, causing these people to lose their jobs.
There has been a recent report that some states have a combined $1 trillion shortfall of funding for it's retirement plans. This is money that is not going to be able to be recovered with decreased tax revenues, cutbacks in state employment decreasing the number of employees contributing to the funds, and a depressed investment market.
We have a significant number of states who have become dependent on the stimulus money for their state budgets, money that will be exhausted and will not likely be replenished. This will cause a cutback in services at the state level which translates into layoffs.
Finally, all of these factors combine for a second assault on the economy in the multiplier effect. State employees are often fairly well paid. Their salary contributes to the economy by them spending money and thus creating jobs. Same for workers in the auto industry, which will have a hard time hiring more and may even face lay offs if employment does not rebound. One well paid employee supports something like 2 other employees through their spending (I'm sorry, I've forgotten the actual multiplier).
So back to the original question, is this a good idea politically? I think Obama has blown his cover. He is now taking ownership of the economy. If he has been saying the downturn was Bush's fault and he has now fixed things, isn't he now responsible for what happens next? I realize the administration will continue to blame Bush right up until the 2012 election and there will be even some in the fringe media who will go along. The question is, will the public buy it?
What do you think?