"IT'S the economy, stupid," was the phrase that ushered Democratic candidate Bill Clinton into the White House in 1992. The win erased a huge foreign policy victory in Iraq under President George H.W. Bush, who went down to defeat due to a bad economy.

Many pundits, including those from the Democratic side of the aisle, are reminding President Obama of the history lesson: Nothing is bigger in voters' minds than the economy. As with the first President Bush, if the president relies only on the success of the recent raid that led to the killing of Osama bin Laden, he'll get trounced by a torrent of out-of-work voters burdened by a sluggish economy coupled with high gasoline prices.

The warning can hardly be labeled Obama bashing, because it comes from

Democratic frontman James Carville, who coined the phrase that helped get Clinton elected in 1992. Carville recently went on TV to say that a paltry 54,000 jobs created in May is not going to cut it, and that Obama needs to focus on jobs for the next 16 months.

Obama deserves credit for pushing through an $80 billion bailout for both Chrysler and General Motors. So far, both companies have recovered and have paid back nearly all of the loans to the U.S. and Canada for the bailout that began in the administration of George W. Bush.

The American auto industry has certainly been adding jobs and increasing sales. Problem is, there is no political will for any future bailout or stimulus to other segments of the economy.

In fact, it seems like the nation's economic engine is stalling because of the gunk in its fuel injectors - billions in toxic home mortgages.

One of the answers lies in pumping up the flattened housing sector, which has seen the lowest prices of existing homes since the real estate bubble burst in 2007. For the last two years, the economic recovery has taken place without the real estate and construction industries, making this recovery one that lacks any sustained strength.

Experts estimate about 11 million Americans are underwater on their mortgages - that is, their homes are worth less than they owe. These folks owe a staggering $766 billion. They are barely able to keep their heads above water themselves, and are definitely not in a position to spend much money to fuel a consumer economy.

If the banks were to offer mortgage write-downs to these hard-working Americans, it would pump money into the economy and send a steady revenue stream to the banks, too. Money would land in places where most middle-class Americans reside - their homes. The estimated $73 billion cost would be a wise investment to get these folks spending again on ordinary purchases and home repairs.

The Obama administration must both take on and work with the big banks to provide help to people with underwater mortgages. Fixing this part of the economy would free the rest of it to grow. With cash flowing, small business owners would hire new workers, and the positive ripple effect would multiply exponentially.

It's unfortunate it appears neither President Obama nor the Republican-led House of Representatives has the guts to take on the banks. Neither has a cohesive plan to improve the economy and create jobs. Simply cutting spending and drawing down the deficit - as the House Republicans want to do - fine an idea as it is in the long run, will take time to be realized and even longer to impact the economy.

Both sides must recognize there is no easy fix. But failing to recognize how important addressing the ongoing mortgage crisis is to fixing the overall economy will certainly send the already fragile recovery in the wrong direction.