The Independent Investor: Presidential Power in an Election Year
|"Executive power has been regarded as a lion which must be caged. So far from being the object of enlightened popular trust, far from being considered the natural protector of popular right, it has been dreaded, uniformly, always dreaded, as the great source of its danger."
— U.S. Sen. Daniel Webster of Massachusetts, 1834
In the heat of this year's presidential election campaign, voters usually lose sight of one of the most important facts surrounding that office. American presidents, for the most part, have much less power than we think.
Recall the high hopes you may have had in 2008 when candidate Barack Obama promised that "Yes we can" fix the economy, get Americans working again, etc., etc. In his first two years in office. there was plenty of action in translating his vision into reality. We had the stimulus package, Obamacare, clean energy initiatives and a rising deficit as a result. Of course, his party controlled both houses of Congress so passing legislation was a breeze.
But the Tea Party and the mid-term elections of 2010 revealed just how little power the Obama presidency (or any presidency) can muster in the face of a divided Congress. Sure, blame Obama. After all, some of his predecessors managed to get legislation passed despite a hostile Congress, but not many. The historical truth is that the founding fathers designed the office to disappoint those of us who want a powerful leader. You see, those Colonial revolutionaries distrusted government in general and the presidency in particular and our political system evolved accordingly.
The Supreme Court, the Federal Reserve Bank, Congress and don't forget the states all detract from the power this one individual might have held over our life. In order to change anything, let alone move the country in a new direction, the president must create a coalition of interests throughout the other branches of government. This is exactly what the founding fathers, fresh from their battle with King George and the British monarchy, intended.
Yet we still expect the person who succeeds to the presidency to be someone with the power of Superman, the charisma of the Messiah and the personal life of Mother Theresa. The candidates understand this. They are forced to promise us the world knowing full well that they do not have the power to deliver it. If they actually told us the truth — that the office holds little power and voters should not expect much of them — would anyone vote for them?
In foreign policy, the president does have somewhat more authority, but once again it is limited by public opinion, Congress and geopolitical realties. As an example, George W. Bush, despite his adversity to nation-building, became an unwilling hostage to a strategy he appalled thanks to 9/11. As for the Obama presidency, it has failed to change public opinion in any decisive manner despite the great expectations of many around the globe when he was first elected.
Mitt Romney appears to want to take a more proactive stance in foreign policy, citing the re-emergence of Russia as a threat as well as viewing China as both an economic and military adversary of sorts. Like his predecessors, if elected, how well he will do in actively balancing the various chess pieces on the world board is far more dependent on what other parties do.
Presidents are far more successful as messengers; some might say visionaries, who can guide the nation along a path while orchestrating the various political players in the band to acquiesce (via compromise) to his point of view. The problem with that role in today's politics is that both parties now reflect the increasing polarization of American society. Neither side is willing to compromise, believing deeply that their way is the right way. The next president might well achieve history but not on his own terms. It would be wise if we all remember that when we vote.
A note to my readers in the Berkshires:
I have volunteered to teach a course this fall at Berkshire Community College at the Osher Lifelong Learning Institute (OLLI). The classes will be on Mondays from 2:45-4:15 p.m. throughout September and October. The course, "America's Future: Buy, Sell or Hold?" will teach students to think critically about such events as this year's presidential elections, wealth and women, our education system and much more. For more information or to sign up for the course call the OLLI office at 413-236-2190.
Bill Schmick is registered as an investment advisor representative with Berkshire Money Management. Bill’s forecasts and opinions are purely his own. None of the information presented here should be construed as an endorsement of BMM or a solicitation to become a client of BMM. Direct inquires to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com.