The Myth of the Grand Bargain

March 18, 2012   ·   2 Comments

Source: NYTX


By Marie Burns:

Jonathan Haidt, a psychology professor, writes a provocative but ultimately foolish “Campaign Stops” post in today’s New York Times. Central to his argument is the notion that liberals and conservatives belong to competing “tribes,” each of which operates under a distinct “sacred” heroic narrative myth. Haidt, borrowing from other scholars, lays out these mythologies in some detail. The liberal mythology idolizes “victimized groups as sacred objects.” The conservative myth, developed by Ronald Reagan, idealizes God and country:

I have some quibbles with Haidt’s constructions, but what I find most interesting, and most disturbing, is that the entire point of his post is to advocate for yet another pervasive tribal myth: the Myth of the Grand Bargain, one that borrows prodigiously from the conservative tribal myth. Haidt concludes, based on no evidence other than, apparently, his personal belief, “America faces multiple threats and challenges, many of which will require each side to accept a ‘grand bargain’ that imposes, at the very least, painful compromises on core economic values.”

The “grand bargain,” as you probably know, is a “painful compromise” where all – or almost all – of the pain will be borne by ordinary Americans. Over the past several years, blue ribbon panels, members of Congress, the President and an array of right-wing commentators have proposed variations on the same theme: in all of these iterations, the grand bargain goes like this: substantial reductions in mandatory or “entitlement” programs – especially Medicare, Medicaid, and Social Security – and paltry increases in revenues, with the goal being deficit reduction. The principle promoters – or in Haidt’s terminology, “tribal leaders” – of the grand bargain mythology have been billionaire Pete Peterson, and a host of millionaires, from aged conservatives like former GOP Senators Alan Simpson and Pete Domenici, to nominal ConservaDems like coupon-clipper Erskine Bowles, Senator Mark Warner and President Obama, to the conservative punditocracy like David Brooks and Tom Friedman of the New York Times and Fred Hiatt of the Washington Post.

I know Haidt isn’t an expert on the economy, but it is more than a little troubling that Pete Peterson’s deceitful agenda has not only filtered down to people like him, but that intelligent people – as Haidt no doubt is – have bought into the deception and have accepted the grand bargain mythology as an “heroic narrative.”

The impetus, or excuse, for the grand bargain is the huge federal deficit. Deficit hawks have devised a rash of rationales to argue for drastic – often immediate – deficit reduction. Pete Peterson employs the usual scare tactic: “The possibility of a significant and sudden increase in interest rates, a precipitous fall in the dollar, and a devastating effect on housing could completely derail our already fragile and jobless economic recovery and make our long-term fiscal situation worse.” Republicans often refer to the horror of leaving our children and grandchildren with a legacy of the debt. David Brooks frames the deficit as a moral failing of the American character.

These arguments are largely bogus. For the most part, failure to collect adequate revenues, in combination with an aging population and rising medical costs, are what, in Peterson’s words, are “making our long-term fiscal situation worse.”As Ezra Klein wrote last year, “Those trends pose budgetary problems that we have to deal with, but they don’t say anything in particular about our national character, or the moral fiber of this generation.” It is not immoral to get old or sick.

As Klein noted, “Every generation has an incentive to cut taxes on itself, but none ran up huge deficits doing so until Ronald Reagan.” George W. Bush successfully urged the Congress to do the same during his administration. A cynical person might suspect that Republicans run up large deficits on purpose – once the deficit is high enough to suit them, they start their chicken-little routine, insisting that the only way to keep the sky from falling is to cut social safety-net programs.

As I’ve explained elsewhere, the current deficit is not an “immoral” burden on our children and grandchildren, either. To the extent that our overall public and private debt is owed to Americans (as it largely is), it doesn’t really matter whose children and grandchildren reap the profits when the debt comes due.

If you want to frame the federal deficit in moral terms, here’s how to do so: in a recession or depression, when the private sector is not spending, the federal government has a “moral” obligation to step in and do the spending that will lift the economy. Besides, it’s sound public policy. If the tax code were properly adjusted – and it is not – once the the government has revitalized the economy, the resulting tax revenue growth would minimize the deficit. Wow! The grandkids would be spared, too!

Now, back to full-blown cynicism. Astute political observers are aware that every conservative overture for a grand bargain is a trick, an opening salvo. As Paul Krugman wrote last summer while President Obama was “negotiating” a grand bargain with House Speaker John Boehner (R-Ohio), “any Grand Bargain will last precisely as long as Democrats control the Senate and the White House, and will be torn up in favor of privatization and big tax cuts for the wealthy as soon as the GOP has the chance.”

What’s more, Haidt and other proponents of the grand bargain mythology imply or say outright that “extremists” on the left and right are responsible for the failure of Congress and the President to reach a grand bargain. But there’s nothing “extremist” about Social Security and Medicare, the “entitlement” programs the millionaire grand bargainers intend to cut. As economist Dean Baker wrote last fall,

Overwhelming majorities of every group, including Republicans and self-identified supporters of the Tea Party, are opposed to cuts to Social Security and Medicare. The only people who seem to support such cuts are wealthy people like [Tom] Friedman…. The large deficits the country currently faces are due to an economic collapse caused by Wall Street greed and the incompetence of people with names like Alan Greenspan, Ben Bernanke, and Hank Paulson.

Baker notes that Friedman “doesn’t call for sacrifices from these people.” But of course it isn’t just Friedman who spouts this stuff. It’s all of the Tribe of the Grand Bargain, repeating their tribal mantra, a mantra which unfortunately has mesmerized Prof. Haidt.

We used to have a grand bargain in this country, but it is not the one Haidt and others write about today. The grand bargain back in the day was a bargain among business, labor and government. As George Packer of the New Yorker has said, there once existed in this country “an unwritten social contract among labor, business, and government – between the elites and the masses. It guaranteed that the benefits of the economic growth following World War II were distributed more widely, and with more shared prosperity, than at any time in human history.” (Sorry, Packer’s speech is no longer online.) The result of this truly grand bargain was a remarkably robust economy, an economy that lifted millions of Americans from poverty into the middle class. Republicans like Presidents Eisenhower and Nixon were fully invested in that grand bargain. It was only with President Reagan that the new conservative mythology took hold, a mythology that Haidt describes in his post as one which – among other elements – castigates liberals: “instead of requiring that people work for a living, [liberals] siphoned money from hard-working Americans and gave it to Cadillac-driving drug addicts and welfare queens.”

The proponents of today’s grand bargain, including Prof. Haidt, have bought into the Reagan mythology, a mythology that, as it took hold, gnawed away the great American success story like rats on cheese. This new Tribe of the Grand Bargain aims to further erode our once-grand American bargain – the one that created perhaps the greatest economic success story in the history of the world. That was no myth, but thanks to Reagan and his tribal legacy, it is today just a memory. If Prof. Haidt and his tribe succeed in spreading the odious mythology of the grand bargain, the legacy we leave our children and grandchildren will be a great deal worse than public debt.

Marie Burns blogs at RealityChex.com


Readers Comments (2)

  1. alphonsegaston says:

    As I was reading Prof. Haidt’s piece, my memory was being prodded to find a piece I had just read somewhere else in the Sunday paper. Somewhat disturbed by tornado sirens (no touchdowns) I had to search for it in the pile of papers ready for recycling.

    “Why Some Countries Go Bust” is what I was looking for, in the Times Magazine. Author Adam Davidson is reviewing a recent book by M.I.T. professor of economics Daron Acemoglu and James Robinson. After citing and dismissing the theories of Adam Smith, Malthus, J.M. Keynes, and Jeffrey Sachs, Davidson briefly puts the book’s argument thus: “the wealth of a country is most closely correlated with the degree to which the average person shares in the overall growth of the economy.”

    Which is what Marie has pointed out in her next-to-last paragraph.

  2. maineprep says:

    The “grand bargain” Friedman and others seeks has the potential to create “peace in our time.”

    In math, it’s pretty clear that to change the average, one need only move numbers on one end of the range. So, in politics, the “middle ground” is always shifting in one direction or the other, and as such is never worth fighting for.



Reload Image

More in NYT OP-EDS, REALITYCHEX (383 of 564 articles)