Since the presidential election last November, the right wing has seized nearly every opportunity to link any sharp decline in the stock market (without any basis in fact) to Barack Obama. Yesterday, losses on Wall Street forced the Dow Jones industrial average to close “below 7,000 for the first time since 1997” and like clockwork, the right (and some on Wall Street) jumped to blame Obama. The Wall Street Journal claimed today that “Obama’s policies have become part of the economy’s problem.”
Laura Ingraham said today that Obama’s policies “are not giving us the confidence we need to get back into the market.” Rush Limbaugh and Sean Hannity touted the line as well, but added that the market’s problems started when Obama was nominated to be the Democratic Party’s candidate for president in the middle of last year:
LIMBAUGH: To say that Obama has been in office only one month is not accurate from an effect on the world and an effect on the country standpoint. Barack Obama has been the controlling political authority on the economy for six months.
HANNITY: Now if we go back to May 6th when it was apparent that he was going to probably be the Democratic nominee the stock market was over 13000, and if we go to October just before the election…the stock market was, what, around the 11000 plus mark.
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Of course, the Limbaugh-Hannity theory carries little weight as the market decline started well before Obama’s nomination. The market peaked in October 2007 and “came tumbling down last spring, when the bursting of the housing bubble started to add up to massive losses for Wall Street banks and other financial services firms tied to bad mortgages.”
In fact, yesterday’s decline came as “investors reacted to reports that construction and industrial activity had continued to decline and to a $61.7 billion loss posted by the insurance giant, the American International Group.” Moreover, the main issue surrounding the market’s fall is decreased company profits as a result of a weak economy, not Obama’s policies. As USA Today noted this morning, “[p]rofits are down sharply” which is “driving stock prices down sharply.”
President Obama noted earlier today that “the banking system has been dealt a heavy blow” to the market. “We dug deep hole for ourselves, he said. “There was a lot of bad decisions that were made. We’re cleaning up that mess. … But its going to get cleaned up.”
Pat Garofalo has more.