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Barack Obama Is No Franklin Roosevelt

June 19, 2012   ·   0 Comments

Source: NYTX

By Marie Burns:

The writers of many New York Times “Campaign Stops” essays have concentrated on the themes or minutia of the 2012 presidential contest, but two recent entries go beyond the horse race to look at a more essential problem. Because of the extraordinary craziness of today’s Republican party – a heightened state of looniness highlighted during the presidential primary season – the dysfunction in the GOP has received somewhere near its due share of attention. Less noticed has been that other party. But former senator Gary Hart (D-Colorado) and Columbia journalism professor Thomas Edsall have used the Times op-ed page to shine a little light on the cobwebs in the Democrats’ dilapidated house.

Former senator Gary Hart, whose middle name should be Narcissus, argued in a “Campaign Stops” post last week that some 30 years ago, the Democratic party did not make the necessary changes – like ones he recommended – to confront the challenges of new economic circumstances. Hart claims that he and many other Democrats of his generation “believed every bit as strongly in the social contract and care for the needy as the most ardent New Dealer.” The only way to sustain that contract, Hart argued, is to ensure “that the economic pie … continue to grow to generate the revenues required to finance that contract.” But Democrats blew it: “The Democratic response of triangulation and centrism, essentially splitting the difference between reactionary liberalism and increasingly virulent conservatism, cost the party its identity….” Here, of course, Hart was referring to ConservaDems like President Bill Clinton, whose catering to business and financial interests helped lay the foundations for the crash of 2008. “Many people, especially young people,” Hart observed, “do not know the basic principles of the current Democratic Party or what it stands for.”

In a “Campaign Stops” essay posted late Sunday night, Columbia journalism professor Thomas Edsall backs up Hart’s observations:

… the Democratic Party has failed to develop a coherent or consistent set of policies to address what is now the dominant issue of the day, the violent restructuring of the American economy, which can be seen from many angles: in the continuing after effects of the financial collapse of 2008; in the rise of inequality; in the decline of social and economic mobility; and in the devastating $49,100 drop in average family wealth, from $126,400 in 2007 to $77,300 in 2010, a 39 percent drop of net assets in just three years.

Edsall explains how that happened. In a previous post, to which he referred in Sunday’s essay, Edsall wrote,

As a practical matter, the Obama campaign and, for the present, the Democratic Party, have laid to rest all consideration of reviving the coalition nurtured and cultivated by Franklin D. Roosevelt. The New Deal Coalition – which included unions, city machines, blue-collar workers, farmers, blacks, people on relief, and generally non-affluent progressive intellectuals – had the advantage of economic coherence. It received support across the board from voters of all races and religions in the bottom half of the income distribution, the very coherence the current Democratic coalition lacks.

Edsall explains why the Democrats’ abandoning the New Deal Coalition matters when it comes to Democratic policy: “… the loss of white non-college voters has diminished pressure within the Democratic Party to address … the loss of low-to-medium-skill jobs that paid high wages to workers without college degrees.”

This may sound a bit counter-intuitive. After all, Democrats have created a new coalition, and as Edsall himself notes, “the white working class is declining steadily as a share of the electorate.” What Edsall does not mention is that a huge chunk of the Democrats’ new coalition – people of color – are in the same socio-economic niche as non-college-educated working class whites. The only difference – and I consider this a difference without a distinction – is the color of their skin. These people need jobs, too; in fact, their rate of unemployment is higher than those of working-class whites.

Edsall notes another group that has become part of the new Democratic coalition: “Democrats have made huge gains in a previously Republican constituency, well-educated white professionals, many with advanced degrees.” These workers, though their rate of employment is better than that of non-college-educated workers, are under deep economic stress, too. Rising wealth inequality and job instability – exacerbated by the economic downturn – not to mention the costs of those advanced degrees, have made this group vulnerable. Academics Theresa Sullivan (whom the regents [a/k/a “visitors”] of the University of Virginia just ousted from the university’s presidency), Elizabeth Warren (yes, that Elizabeth Warren) and Jay Westbrook surveyed 2,452 people who filed for bankruptcy during the 1990s and recorded their results in their 2001 book The Fragile Middle Class.

Included in their sample are teachers, accountants, computer engineers, sales clerks, executives, entrepreneurs, doctors and dentists – solidly middle-class folk who fell into financial disaster. Employment problems (layoffs, ‘skidding’ to a lower-paying job, part-time work) were the biggest factor, as was the overuse of credit cards. Respondents also cited unpayable medical bills, loss of income from illness or accident, the financial burden on single-adult households that result from divorce and home buyers purchasing more than they could afford.

That is, nearly every Democratic voter who isn’t Warren Buffett is vulnerable to the vicissitudes of an economic system that favors the tippy-top earners over everyone else. As Gary Hart wrote, triangulation and centrism are not the answers. Yet triangulation and centrism is what Democrats offer. President Obama often says, “I know that for the millions of Americans who are looking for work, and all those who are struggling in this economy, full recovery can’t come soon enough. I hear from you at town hall meetings like this. I read your letters. These stories are the first thing I think about in the morning and the last thing I think about at night – and the focus of my attention every day.” (July 23, 2009) Or a variation on that theme. These declarations would be more credible if he – and Democratic members of Congress – backed up their supposed concerns with actions. But back in the summer of 2009, Obama’s hired guns Tim Geithner and Larry Summers were going on the teevee come a Sunday morning and saying the jobs would lag behind the Wall Street recovery and that was, you know, too bad. As Kevin Drum of Mother Jones wrote recently in assessing Obama’s early mistakes,

Although Obama didn’t have the leverage to get more stimulus spending even if he’d wanted it, he could have done more on the housing front, [which]… was quite feasible and would probably have made a noticeable difference in keeping the recovery on a stronger track…. Tim Geithner just didn’t like the idea of pressing harder on the mortgage relief front, and Obama went along.

And Steve Waldman documented in a meeting with Treasury officials in 2010 that the real purpose of the Home Affordable Mortgage Program was not to help homeowners but to nurse the banks through a recovery:

Even if most HAMP applicants ultimately default, the program prevented an outbreak of foreclosures exactly when the system could have handled it least. There were murmurs among the bloggers of ‘extend and pretend’, but I don’t think that’s quite right. This was extend-and-don’t-even-bother-to-pretend. The program was successful in the sense that it kept the patient alive until it had begun to heal. And the patient of this metaphor was not a struggling homeowner, but the financial system, a.k.a. the banks. Policymakers openly judged HAMP to be a qualified success because it helped banks muddle through what might have been a fatal shock. I believe these policymakers conflate, in full sincerity, incumbent financial institutions with ‘the system’, ‘the economy’, and ‘ordinary Americans’.

There you see the problem. These are not bad people. They just conflate big banks with “ordinary Americans.” Probably you do not make the same mistake.

In the summer of 2009 President Obama inexplicably took a morning break from his summer vacation on Martha’s Vineyard to announce his reappointment of Republican Ben Bernanke to head the Federal Reserve. This year Paul Krugman (among others) faulted Bernanke for being far too timid in fulfilling the second half of his dual mandate: ensuring maximum employment.

From there, Obama segued into full “triangulation, centrist” mode. (If you want to call it “right-wing” mode, you won’t get an argument from me.) Along came the “belt-tightening” speeches, his appointment of deficit hawks Alan Simpson and Erskine Bowles to head his Deficit Reduction “Catfood” Commission and the appointment of GE CEO Jeff Immelt, head of a company known for sending U.S. jobs overseas, to chair the administration’s Jobs Commission. The final straw was last summer’s debt ceiling debacle when Obama reportedly out-cut Simpson and Bowles in an attempt to reach a deficit reduction deal with House Speaker John Boehner (R-Ohio).

As far as I can discern, it was only rising unemployment numbers, which threatened Obama’s re-election chances, followed by the protests of the Occupy Wall Street movement that caught President Obama’s attention and knocked him off this rightward trajectory. In December 2011, Obama retooled his message in a speech he delivered in Osawatomie, Kansas:

There has been a raging debate over the best way to restore growth and prosperity; balance and fairness…. This is the defining issue of our time. This is a make or break moment for the middle class, and all those who are fighting to get into the middle class. At stake is whether this will be a country where working people can earn enough to raise a family, build a modest savings, own a home, and secure their retirement.

Contra Edsall, the goals President Obama described in his Osawatomie speech do define a Democratic view of the fundamental problems the nation faces.

The problem, as I see it, is that Obama has given little indication he favors true Democratic solutions. His proposals have been timid. He wants the super-rich to “pay a little more” in taxes. He wants regulations to be “smart.” (Who wants them to be stupid?) If Barack Obama is leaning on financial regulators and the Justice Department to come down hard on Wall Street’s bad actors, he is certainly managing to keep that secret. The banks – despite the recent JPMorgan Chase multi-billion-dollar derivatives-trading fiasco – are still busy watering down the Volcker Rule. Not a single big banker has been prosecuted for bad acts leading to the 2008 financial crisis. Obama appointed an investigative team to look into financial wrongdoing, headed by New York State Attorney General Eric Schneiderman, but that has, to no one’s surprise, proved to be a sham. On the housing front, Obama has refused to fire Eddie DeMarco, the acting director of the Federal Housing Finance Agency (which controls Fannie Mae and Freddie Mac), a man Peter Goodman of the Huffington Post calls “the single largest obstacle to meaningful economic recovery.” Just yesterday the Wall Street Journalreported that DeMarco insists on maintaining a mortgage refinancing program that benefits the big banks more and homeowners less – despite the efforts of Obama’s HUD director Shaun Donavan to liberalize the policy in favor of homeowners.

It is clear that liberals do not have a friend in the Oval Office.

Of course, President Obama has done the right thing on a few issues of importance to liberal interest groups. He has moved in the right direction on gay rights, for instance, and just last week he unilaterally wrote a limited version of the DREAM Act, an immigration bill which has been stalled in Congress since Obama was a Senator. So maybe Obama’s heart is in the right place, after all. Let’s ask Glenn Greenwald. In a post published last Friday, titled “The Imperatives of Political Pressure,” Greenwald wrote,

Throughout the Obama presidency, one of the most vocal and demanding factions in the Democratic Party base has been activists for gay and lesbian equality. They repeatedly protested at Obama events and even at the White House, complained loudly about Obama’s broken promises, and even threatened to boycott Obama’s re-election campaign by withholding donations.… Latino activists have been as confrontational and unwilling to fall into line as good, compliant partisan soldiers. They publicly protested Obama’s record number of deportation, complainedabout his immigration policies, loudly accused him of ‘betrayal,’ and expressed subsstantial disapproval for him in polls.

This brings us back to Tom Edsall’s essay. Remember that he wrote, “… the loss of white non-college voters has diminished pressure within the Democratic Party to address … the loss of low-to-medium-skill jobs that paid high wages to workers without college degrees.” Key word: pressure.

It would be nice if Democratic leaders led. A few do. (The Congressional Progressive Caucus, for instance, has proposed budgets that would both preserve the social safety net and reduce the federal deficit.) But in a democracy, there should always be a tension between “leaders” and “followers.” President Obama is no worse a leader than other politicians. He is better than some. The real problem is not in our president but in ourselves. As Edsall implies, “followers” must pressure “leaders” into addressing their needs. Wealthy and right-wing special interests have spent decades dismantling the most effective pressure groups for the working-class: the unions. With private-sector unions weakened or “disappeared,” the working class no longer has institutional advocates. This has allowed the right to “divide and conquer” workers. Non-union workers resent the better wages and benefits union workers receive. Many of the last unions standing are public-sector unions, making it doubly easy for Republicans to convince working taxpayers that they are paying higher taxes so “lazy bureaucrats” can live lives of ease and security. When he appeared on “Meet the Press” Sunday, Sen. John McCain (R-Arizona) equated unions and billionaires – both were “special interests,” he said, which funded political campaigns. That’s true. But one of those “special interests” represents millions of ordinary Americans – including non-union Americans – while the other represents the super-rich .01 percent. McCain is like those Obama Treasury officials who couldn’t tell the difference between big bankers and “ordinary Americans.”

There is a group that represents the other 99.99 percent. The Occupy movement is gearing up again. Edsall and Greenwald are right. The squeaky wheel – and only the squeaky wheel – gets the grease. If Democrats have given up on white working-class voters, it is because these voters have quit pressuring Democrats. A good percentage of the grandchildren of New Deal voters do not participate at all in the democratic process. They don’t vote. Others vote, often unwittingly, against their self-interests. Alec MacGillis of The New Republic went to a weekend free clinic in Tennessee last week. While he was there, he asked a number of the uninsured patients what they thought of the Supreme Court’s upcoming ruling on “the new national healthcare law.” Answer: “What new law?” By cutting funding for public education at all levels, by moving taxpayer dollars into private for-profit education, and by rewriting textbooks with fact-averse and religious copy, the right is dumbing down the electorate. This massive “unintelligent design” project works well for special interests who can more easily mislead the low-information voters and of course completely sidestep the ignorant and non-voters.

Today, the pressure most politicians – of both parties – feel comes from these big-money donors and business lobbyists. Ordinary Americans must apply equal pressure, if not with their pocketbooks then with their voices. If Astro-turf Tea Parties could work – and it did – real grassroots organizations are capable of much more.

Marie Burns blogs at RealityChex.com

By marieburns

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