Nobel Laureate economist Paul Krugman, in a New York Times column, laments that even though conventional wisdom has been proven wrong for the past 5 years, it still remains powerful enough to influence public policy.

Back in the 1950s three social psychologists joined a cult that was predicting the imminent end of the world. Their purpose was to observe the cultists’ response when the world did not, in fact, end on schedule. What they discovered, and described in their classic book, “When Prophecy Fails,” is that the irrefutable failure of a prophecy does not cause true believers — people who have committed themselves to a belief both emotionally and by their life choices — to reconsider. On the contrary, they become even more fervent, and proselytize even harder.

This insight seems highly relevant as 2012 draws to a close. After all, a lot of people came to believe that we were on the brink of catastrophe — and these views were given extraordinary reach by the mass media. As it turned out, of course, the predicted catastrophe failed to materialize. But we can be sure that the cultists won’t admit to having been wrong. No, the people who told us that a fiscal crisis was imminent will just keep at it, more convinced than ever. ..

Seriously, at every stage of our ongoing economic crisis — and in particular, every time anyone has suggested actually trying to do something about mass unemployment — a chorus of voices has warned that unless we bring down budget deficits now now now, financial markets will turn on America, driving interest rates sky-high. And these prophecies of doom have had a powerful effect on our economic discourse….

Regular readers know that I and other economists argued from the beginning that these dire warnings of fiscal catastrophe were all wrong, that budget deficits won’t cause soaring interest rates as long as the economy is depressed — and that the biggest risk to the economy is that we might try to slash the deficit too soon. And surely that point of view has been strongly validated by events.

The key thing we need to understand, however, is that the prophets of fiscal disaster, no matter how respectable they may seem, are at this point effectively members of a doomsday cult. They are emotionally and professionally committed to the belief that fiscal crisis lurks just around the corner, and they will hold to their belief no matter how many corners we turn without encountering that crisis.

So we cannot and will not persuade these people to reconsider their views in the light of the evidence. All we can do is stop paying attention. It’s going to be difficult, because many members of the deficit cult seem highly respectable. But they’ve been hugely, absurdly wrong for years on end, and it’s time to stop taking them seriously.

Beezer here. In his seminal book The General Theory of Employment, Interest, and Money economist John Maynard Keynes made a similar argument regarding Ricardian economics, that it had ‘conquered England as completely as the Holy Inquisition conquered Spain.’ He then went on the write this iconic paragraph:

“That it (Ricardian economics) reached conclusions quite different from what the ordinary uninstructed person would expect, added, I suppose to its intellectual prestige. That its teaching translated into practice, was austere, and often unpalatable, lent it virtue. That it was adapted to carry a vast and consistent logical superstructure, gave it beauty. That it would explain much social injustice and apparent cruelty as an inevitable incident in the scheme of progress, and the attempt to change such things as likely on the whole to do more harm than good, commended it to authority. That it afforded a measure of justification to the free activities of the individual capitalist, attracted to it the support of the dominant social force behind authority.”

Beezer again.  As Keynes did 76 years ago, Krugman pushes back against the Ricardian view that it is impossible for effective demand to be deficient.  Fortunately when Keynes wrote the then President, Franklin Delano Roosevelt, listened and used the power of the state to hire more than 8 million people during his first two terms, clipping more than 10% off the unemployment rate.  Unfortunately today this President, Barack Obama, has not listened to Krugman as FDR listened to Keynes.  And that is why unemployment remains too high and comes down grudgingly.

From a post over at Rortybomb, where the author posts some Depression era pro-FDR political cartoons.  The one below won the cartoonist John T. McCutcheon a Pulitzer Prize.

From the blogpost at London Banker here are excerpts from testimony by millionaire Marriner Eccles to a Congressional Committee in 1933.  It was an historic event because Eccles made recommendations for the FDIC, Federal Reserve Board reforms, income and inheritance taxes, social security and unemployment insurance among other far reaching ideas. 

Beyond that Eccles provides a precise description of the problems faced by the US then, during President Franklin Delano’s second year of office.  It’s astonishing how much his description of the problems then match our current problems.  He showed what was needed to be done back then.  Unfortunately for the US today, this speech and Eccles’ reasoning have long been forgotten.  So we continue to do the wrong things today, to repeat the errors that were made in the late 1920s and early 1930s which plunged the country into a Great Depression.

From the post:

I repeat there is plenty of money today to bring about a restoration of prices, but the chief trouble is that it is in the wrong place; it is concentrated in the larger financial centers of the country, the creditor sections, leaving a great portion of the back country, or the debtor sections, drained dry and making it appear that there is a great shortage of money and that it is, therefore, necessary for the Government to print more. This maldistribution of our money supply is the result of the relationship between debtor and creditor sections – just the same as the realtion between this as a creditor nation and another nation as a debtor nation – and the development of our industries into vast systems concentrated in the larger centers. During the period of the depression the creditor sections have acted on our system like a great suction pump, drawing a large portion of the available income and deposits in payment of interest, debts, insurance and dividends as well as in the transfer of balances by the larger corporations normally carried throughout the country….

The maladjustment referred to must be corrected before there can be the necessary velocity of money. I see no way of correcting this situation except through Government action.

Beezer here.  Eccles saw that there was no shortage of capital in the country, but that there was a huge drop in demand caused by an increase in private debt.  He correctly saw that this imbalance basically left most of the country impoverished and under employed, with all the money concentrated in the hands of a very few at the top of the income ladder.  Interestingly, he argued against increasing the money supply.  It was not needed, Eccles believed.  The problem was primarily one of distribution–money had flowed upwards from labor to banks and creditors.  Too much so, therefore Eccles recommended raising taxes on the wealthy, including tax reform that reduced the ability to pass on wealth via inheritances.   By doing so, Eccles argued, demand would be returned to previous levels and so would employment and overall economic health.   And so too, Eccles made clear, would the ability to pay down both private and national debt.

President Obama, in demeanor and in training comes across as the ultimate insider.  Although he has tremendous rhetorical skills, a level of skill unmatched since JFK in fact, he has for the most part abandoned those skills since he became President.

During his campaign he used his rhetorical power almost exclusively.  He inspired millions of Americans who were, rightly so, in fear of their future.  The economy was in collapse with no end in sight.   Obama’s rhetoric  soared during his campaign.  He offered the prospect of hope, that the American future was not gone.  Powered by his ability to inspire hope and optimism he became the first non-white  President of the United States.

But after taking office this soaring, emotional rhetoric disappeared.  Occasionally the President would produce an inspiring speech reminiscent of his campaign, but these were isolated incidents after which the President would withdraw back into a cool, official shell that projected the efforts of an ultimate, US Senate insider.

This has been a big mistake for a man whose primary skill may be the ability to deliver an emotional narrative that can inspire the majority of Americans to force change.   It’s long past time for the President to start governing as an outsider. 

With this in mind, we reprint below a famous speech by President Franklin Delano Roosevelt, delivered during FDRs 1936 re-election campaign.  It’s astonishing to see how closely FDR’s situation parallels that of Obama.  And it is equally astonishing that Obama, a man of soaring rhetorical skills, does not use FDR as a model for how to use those skills to govern as an outsider. 

“On the eve of a national election, it is well for us to stop for a moment and analyze calmly and without prejudice the effect on our Nation of a victory by either of the major political parties.

The problem of the electorate is far deeper, far more vital than the continuance in the Presidency of any individual. For the greater issue goes beyond units of humanity–it goes to humanity itself.

In 1932 the issue was the restoration of American democracy; and the American people were in a mood to win. They did win. In 1936 the issue is the preservation of their victory. Again they are in a mood to win. Again they will win.

More than four years ago in accepting the Democratic nomination in Chicago, I said: “Give me your help not to win votes alone, but to win in this crusade to restore America to its own people.”

The banners of that crusade still fly in the van of a Nation that is on the march.

It is needless to repeat the details of the program which this Administration has been hammering out on the anvils of experience. No amount of misrepresentation or statistical contortion can conceal or blur or smear that record. Neither the attacks of unscrupulous enemies nor the exaggerations of over-zealous friends will serve to mislead the American people.

What was our hope in 1932? Above all other things the American people wanted peace. They wanted peace of mind instead of gnawing fear.

First, they sought escape from the personal terror which had stalked them for three years. They wanted the peace that comes from security in their homes: safety for their savings, permanence in their jobs, a fair profit from their enterprise.

Next, they wanted peace in the community, the peace that springs from the ability to meet the needs of community life: schools, playgrounds, parks, sanitation, highways–those things which are expected of solvent local government. They sought escape from disintegration and bankruptcy in local and state affairs.

They also sought peace within the Nation: protection of their currency, fairer wages, the ending of long hours of toil, the abolition of child labor, the elimination of wild-cat speculation, the safety of their children from kidnappers.

And, finally, they sought peace with other Nations–peace in a world of unrest. The Nation knows that I hate war, and I know that the Nation hates war.

I submit to you a record of peace; and on that record a well-founded expectation for future peace–peace for the individual, peace for the community, peace for the Nation, and peace with the world.

Tonight I call the roll–the roll of honor of those who stood with us in 1932 and still stand with us today.

Written on it are the names of millions who never had a chance –men at starvation wages, women in sweatshops, children at looms.

Written on it are the names of those who despaired, young men and young women for whom opportunity had become a will-o’-the-wisp.

Written on it are the names of farmers whose acres yielded only bitterness, business men whose books were portents of disaster, home owners who were faced with eviction, frugal citizens whose savings were insecure.

Written there in large letters are the names of countless other Americans of all parties and all faiths, Americans who had eyes to see and hearts to understand, whose consciences were burdened because too many of their fellows were burdened, who looked on these things four years ago and said, “This can be changed. We will change it.”

We still lead that army in 1936. They stood with us then because in 1932 they believed. They stand with us today because in 1936 they know. And with them stand millions of new recruits who have come to know.

Their hopes have become our record.

We have not come this far without a struggle and I assure you we cannot go further without a struggle.

For twelve years this Nation was afflicted with hear-nothing, see-nothing, do-nothing Government. The Nation looked to Government but the Government looked away. Nine mocking years with the golden calf and three long years of the scourge! Nine crazy years at the ticker and three long years in the breadlines! Nine mad years of mirage and three long years of despair! Powerful influences strive today to restore that kind of government with its doctrine that that Government is best which is most indifferent.

For nearly four years you have had an Administration which instead of twirling its thumbs has rolled up its sleeves. We will keep our sleeves rolled up.

We had to struggle with the old enemies of peace–business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.

They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob.

Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me–and I welcome their hatred.

I should like to have it said of my first Administration that in it the forces of selfishness and of lust for power met their match. I should like to have it said of my second Administration that in it these forces met their master.

The American people know from a four-year record that today there is only one entrance to the White House–by the front door. Since March 4, 1933, there has been only one pass-key to the White House. I have carried that key in my pocket. It is there tonight. So long as I am President, it will remain in my pocket.

Those who used to have pass-keys are not happy. Some of them are desperate. Only desperate men with their backs to the wall would descend so far below the level of decent citizenship as to foster the current pay-envelope campaign against America’s working people. Only reckless men, heedless of consequences, would risk the disruption of the hope for a new peace between worker and employer by returning to the tactics of the labor spy.

Here is an amazing paradox! The very employers and politicians and publishers who talk most loudly of class antagonism and the destruction of the American system now undermine that system by this attempt to coerce the votes of the wage earners of this country. It is the 1936 version of the old threat to close down the factory or the office if a particular candidate does not win. It is an old strategy of tyrants to delude their victims into fighting their battles for them.

Every message in a pay envelope, even if it is the truth, is a command to vote according to the will of the employer. But this propaganda is worse- it is deceit.

They tell the worker his wage will be reduced by a contribution to some vague form of old-age insurance. They carefully conceal from him the fact that for every dollar of premium he pays for that insurance, the employer pays another dollar. That omission is deceit.

They carefully conceal from him the fact that under the federal law, he receives another insurance policy to help him if he loses his job, and that the premium of that policy is paid 100 percent by the employer and not one cent by the worker. They do not tell him that the insurance policy that is bought for him is far more favorable to him than any policy that any private insurance company could afford to issue. That omission is deceit.

They imply to him that he pays all the cost of both forms of insurance. They carefully conceal from him the fact that for every dollar put up by him his employer puts up three dollars three for one. And that omission is deceit.

But they are guilty of more than deceit. When they imply that the reserves thus created against both these policies will be stolen by some future Congress, diverted to some wholly foreign purpose, they attack the integrity and honor of American Government itself. Those who suggest that, are already aliens to the spirit of American democracy. Let them emigrate and try their lot under some foreign flag in which they have more confidence.

The fraudulent nature of this attempt is well shown by the record of votes on the passage of the Social Security Act. In addition to an overwhelming majority of Democrats in both Houses, seventy-seven Republican Representatives voted for it and only eighteen against it and fifteen Republican Senators voted for it and only five against it. Where does this last-minute drive of the Republican leadership leave these Republican Representatives and Senators who helped enact this law?

I am sure the vast majority of law-abiding businessmen who are not parties to this propaganda fully appreciate the extent of the threat to honest business contained in this coercion.

I have expressed indignation at this form of campaigning and I am confident that the overwhelming majority of employers, workers and the general public share that indignation and will show it at the polls on Tuesday next.

Aside from this phase of it, I prefer to remember this campaign not as bitter but only as hard-fought. There should be no bitterness or hate where the sole thought is the welfare of the United States of America. No man can occupy the office of President without realizing that he is President of all the people.

It is because I have sought to think in terms of the whole Nation that I am confident that today, just as four years ago, the people want more than promises.

Our vision for the future contains more than promises.

This is our answer to those who, silent about their own plans, ask us to state our objectives.

Of course we will continue to seek to improve working conditions for the workers of America–to reduce hours over-long, to increase wages that spell starvation, to end the labor of children, to wipe out sweatshops. Of course we will continue every effort to end monopoly in business, to support collective bargaining, to stop unfair competition, to abolish dishonorable trade practices. For all these we have only just begun to fight.

Of course we will continue to work for cheaper electricity in the homes and on the farms of America, for better and cheaper transportation, for low interest rates, for sounder home financing, for better banking, for the regulation of security issues, for reciprocal trade among nations, for the wiping out of slums. For all these we have only just begun to fight.

Of course we will continue our efforts in behalf of the farmers of America. With their continued cooperation we will do all in our power to end the piling up of huge surpluses which spelled ruinous prices for their crops. We will persist in successful action for better land use, for reforestation, for the conservation of water all the way from its source to the sea, for drought and flood control, for better marketing facilities for farm commodities, for a definite reduction of farm tenancy, for encouragement of farmer cooperatives, for crop insurance and a stable food supply. For all these we have only just begun to fight.

Of course we will provide useful work for the needy unemployed; we prefer useful work to the pauperism of a dole.

Here and now I want to make myself clear about those who disparage their fellow citizens on the relief rolls. They say that those on relief are not merely jobless–that they are worthless. Their solution for the relief problem is to end relief–to purge the rolls by starvation. To use the language of the stock broker, our needy unemployed would be cared for when, as, and if some fairy godmother should happen on the scene.

You and I will continue to refuse to accept that estimate of our unemployed fellow Americans. Your Government is still on the same side of the street with the Good Samaritan and not with those who pass by on the other side.

Again — what of our objectives?

Of course we will continue our efforts for young men and women so that they may obtain an education and an opportunity to put it to use. Of course we will continue our help for the crippled, for the blind, for the mothers, our insurance for the unemployed, our security for the aged. Of course we will continue to protect the consumer against unnecessary price spreads, against the costs that are added by monopoly and speculation. We will continue our successful efforts to increase his purchasing power and to keep it constant.

For these things, too, and for a multitude of others like them, we have only just begun to fight.

All this–all these objectives–spell peace at home. All our actions, all our ideals, spell also peace with other nations.

Today there is war and rumor of war. We want none of it. But while we guard our shores against threats of war, we will continue to remove the causes of unrest and antagonism at home which might make our people easier victims to those for whom foreign war is profitable. You know well that those who stand to profit by war are not on our side in this campaign.

“Peace on earth, good will toward men”–democracy must cling to that message. For it is my deep conviction that democracy cannot live without that true religion which gives a nation a sense of justice and of moral purpose. Above our political forums, above our market places stand the altars of our faith-altars on which burn the fires of devotion that maintain all that is best in us and all that is best in our Nation.

We have need of that devotion today. It is that which makes it possible for government to persuade those who are mentally prepared to fight each other to go on instead, to work for and to sacrifice for each other. That is why we need to say with the Prophet: “What doth the Lord require of thee — but to do justly, to love mercy and to walk humbly with thy God.” That is why the recovery we seek, the recovery we are winning, is more than economic. In it are included justice and love and humility, not for ourselves as individuals alone, but for our Nation.

That is the road to peace.”

Beezer here.  FDR won re-election by the widest margin in Presidential history.  In 1936 FDR was hated by his wealthy and powerful peers.  He was one of them but he knew he had to abandon them and, as he said in his speech, he ‘welcomed’ their hatred.  President Obama too much loves the insider status.  He is trying to persuade the public with logic and reasonableness and he will fail unless he abandons those positions, no matter how comfortable they may be to him now that he is President.  It is within his ability to deliver the emotional, overwhelmingly powerful narrative America needs right now.  He needs to welcome the hatred of  powerful interests who have brought the economy low.  Doing so offers him the only path to effective governance, and to being loved by the majority of Americans.

In an incredibly candid video interview with the Wall Street Journal, economics guru Nouriel Roubini explains what’s wrong with Western capitalist economies:  They’re well into the process of transferring labor income to capital, a process that if not contained will create a Depression that threatens not only capitalism, but democracy too.  You can watch the 22 minute interview, or you can go to an article summarizing Roubini’s views here at the Common Dreams blogsite.

First you have to understand that Roubini gained prominence by predicting the housing collapse and the subsequent great recession.  His nickname is ‘Dr. Doom.’  He said he’s now again telling clients to raise cash and take a ‘better safe than sorry’ investment approach.  Roubini sees austerity regimes that ‘front load’ government spending cuts might create a double dip recession that will further crush labor income and make deficits and debt rise rather than fall.  From the Common Dreams article:

Marx, among other theories, argued that capitalism had an internal contradiction that would cyclically lead to crises, and that, at minimum, would place pressure on the economic system.

Companies, Roubini said, are motivated to minimize costs, to save and stockpile cash, but this leads to less money in the hands of employees, which means they have less money to spend and flow back to companies.

Now, in current financial crisis, consumers, in addition to having less money to spend due to the above, are also motivated to minimize costs, to save and stockpile cash, magnifying the effect of less money flowing back to companies.

“Karl Marx had it right,” Roubini said in an interview with wsj.com. “At some point capitalism can self-destroy itself. That’s because you can not keep on shifting income from labor to capital without not having an excess capacity and a lack of aggregate demand. We thought that markets work. They are not working. What’s individually rational…is a self-destructive process.”

Roubini added absent organic, strong GDP growth — which can increase wages and consumer spending — what’s needed is large fiscal stimulus, agreeing with another high-profile economist, Nobel Prize-winner Paul Krugman, that, in the case of the United States, the $786 billion fiscal stimulus approved by Congress in 2009 was too small to create the aggregate demand necessary to advance the U.S. economic recovery to a self-sustaining expansion.

Absent additional fiscal stimulus, or unexpected strong GDP growth, the only solution is a universal debt restructuring for banks, homes (essentially households/families), and governments, Roubini said. However, no such universal restructuring has occurred, Roubini said.

Without that additional fiscal stimulus, that lack of restructuring has led to “zombie houses, zombie banks, and zombie governments,” he said.

No Good Choices Outside of Fiscal Stimulus or Debt Restructuring

The United States, Roubini said, can in theory: a) grow itself out of the current problem (but the economy is currently growing too slowly, hence the need for more fiscal stimulus); or b) save itself out of the problem (but if too many companies and citizens save, the flaw Marx identified is magnified); or c) inflate itself out of the problem (but that has extensive collateral damage, he said).

However, Roubini said he did not think the U.S. or the world are now at the point where capitalism in self destructing.

“We’re not there yet,” Roubini said, but he did add that the current trend, if it continues, “runs the risk of repeating the second leg of the Great Depression” — the ‘mistake of 1937.’

In 1937, President Franklin D. Roosevelt, despite the fact that the first four years of massive New Deal fiscal stimulus had lowered U.S. unemployment from a staggering 20.6 percent during the Hoover Administration at the start ff the Great Depression, to 9.1 percent, felt pressure from Congressional Republicans, and he — as current President Barack Obama did with the Tea Party-led House GOP in 2011 — gave-in to conservatives and cut government spending in 1937. The result? U.S. unemployment started rising again, and hit 12.5% in 1938.

Cutting government spending prematurely hurt the U.S. economy in 1937 by reducing demand, and Roubini sees the same pattern playing out today, following austerity measures contained in the debt ceiling deal.

Beezer here.  The underlying problem is we’ve forgotten what our grandfathers and great grandfathers learned during the Great Depression.  In these circumstances you simply have to hire people.  It doesn’t matter how or who does this, it simply needs to be done.  Our view is that the government needs to raise marginal tax rates (Roubini says countries cannot get out from under debt without doing this) and use that money to hire people to improve infrastructures.  This has three positive effects: a) people will make more money and boost aggregate demand; b) raising marginal tax rates dislodges money that’s essentially being hoarded and frees it up to hire people without increasing deficits and debt; c) improving infrastructure makes US companies more competitive.  By the way Roubini clearly lays responsibility for our problems on President George W. Bush policies.  He points out the Bush tax cuts were ill advised because they increased debt when the country was at war and passing new drug benefits for seniors.  In addition, lax regulatory regimes allowed financial agents, most notably hedge funds and banks, to overleverage and become insolvent once housing prices rolled over, Roubini said. 

Emory University professor of psychology, Drew Westen, has written a brilliant essay analyzing why President Obama’s performance falls far short of the hopes and aspirations his campaign rhetoric encouraged, at least among Democrats.  But the essay’s most valuable contribution is that it provides the narrative Democrats can use to bring real reform from the bottom up instead of waiting for Obama, somehow, to fight for the values he so clearly espoused in his campaign speeches.  Here’s the specific part of the essay explaining the narrative in the form of a  brief speech Obama could have made many times, but never has.

When Barack Obama rose to the lectern on Inauguration Day, the nation was in tatters. Americans were scared and angry. The economy was spinning in reverse. Three-quarters of a million people lost their jobs that month. Many had lost their homes, and with them the only nest eggs they had. Even the usually impervious upper middle class had seen a decade of stagnant or declining investment, with the stock market dropping in value with no end in sight. Hope was as scarce as credit.

In that context, Americans needed their president to tell them a story that made sense of what they had just been through, what caused it, and how it was going to end. They needed to hear that he understood what they were feeling, that he would track down those responsible for their pain and suffering, and that he would restore order and safety. What they were waiting for, in broad strokes, was a story something like this:

“I know you’re scared and angry. Many of you have lost your jobs, your homes, your hope. This was a disaster, but it was not a natural disaster. It was made by Wall Street gamblers who speculated with your lives and futures. It was made by conservative extremists who told us that if we just eliminated regulations and rewarded greed and recklessness, it would all work out. But it didn’t work out. And it didn’t work out 80 years ago, when the same people sold our grandparents the same bill of goods, with the same results. But we learned something from our grandparents about how to fix it, and we will draw on their wisdom. We will restore business confidence the old-fashioned way: by putting money back in the pockets of working Americans by putting them back to work, and by restoring integrity to our financial markets and demanding it of those who want to run them. I can’t promise that we won’t make mistakes along the way. But I can promise you that they will be honest mistakes, and that your government has your back again.”

 A story isn’t a policy. But that simple narrative — and the policies that would naturally have flowed from it — would have inoculated against much of what was to come in the intervening two and a half years of failed government, idled factories and idled hands. That story would have made clear that the president understood that the American people had given Democrats the presidency and majorities in both houses of Congress to fix the mess the Republicans and Wall Street had made of the country, and that this would not be a power-sharing arrangement. It would have made clear that the problem wasn’t tax-and-spend liberalism or the deficit — a deficit that didn’t exist until George W. Bush gave nearly $2 trillion in tax breaks largely to the wealthiest Americans and squandered $1 trillion in two wars.

Beezer here. This is the narrative that deserves to be repeated many, many times–enough times to stand up to the well heeled public relations firms and lobbyists on K Street who promote the conservative mantra.   The only way that can be done effectively is at the ground level in political races from town selectmen up to State Senators and to federal races.   Even FDR was at times too timid when he first took office in the teeth of the Great Depression.  At one point he is reported to have said ”I agree with you, I want to do it, now make me do it.”   It would be nice if Obama took up this narrative, but if he doesn’t he must be forced to.