Sunday, August 15, 2010

Obama's Great Failure

There is a sad irony to the prevalent charge about Obama being too far to the left - namely, that if he loses in 2012, it will almost certainly due to the fact that his policies weren't adequately liberal.

Let me back up.

When I discussed potential scenarios for the 2012 presidential election last September, I divided the possibilities into two categories:

1) A political climate in which the election takes place against the backdrop of economic recovery (as well as the presumed absence of any serious paradigm-altering catastrophes).

2) A political climate in which the election takes place while the economy continues to flounder.

Although most of that piece focused on what would happen in the case of the first hypothetical situation, my prediction regarding the second deserves to be quoted, for reasons that will soon be made clear:

In a situation where the economy is still struggling by late 2011/early 2012, Romney will be the obvious candidate. His extensive background as a fixer-upper in the business community and sterling personal integrity will be exactly what the Republican base and American public crave in such an environment - the former because of his unwavering loyalty to the oligarchy of wealthy Americans and big businesses that rule the Republican party, and the latter because his business background can be sold very easily as a prime qualification for getting us out of our economic turmoil...

If the economy is still flailing in 2012, and Mitt Romney is consequently selected to be the Republican presidential nominee, I do not know who he will choose to be his running mate (apart from the fact that he or she will be a candidate pre-approved by the Christian Right), but I can say that he will win.

The reason this excerpt has become sadly prescient is because, barring the socio-economic equivalent of a deus ex machina, the odds seem extremely good that the economy will not have improved (at least not significantly enough to make a meaningful difference) by the time the 2012 election rolls around. As such, the likelihood seems to be that Willard "Mitt" Romney will become President of the United States on January 20, 2013.

For this, President Obama has no one to blame but himself.

That isn't to say that he is responsible for causing the recession, or even that he's wrong for frequently pointing out that many of its most pernicious attributes (rising unemployment, stagnating wages, soaring budget deficits) actually took off under his predecessor. Indeed, the selective amnesia of the right-wingers who are now trying to claim that the recession is Obama's fault - despite the fact that the recession itself began fourteen months before he took office and was caused by the deregulatory and anti-labor policies of Ronald Reagan and his three successors - provides yet another example of how ideological dogmatism, when blended with partisan zealotry, causes even intelligent people to draw blatantly illogical conclusions (liberals are not exonerated from this tendency either, as indicated by the deification of Obama during the 2008 campaign or the insistence by many on the left that the Fort Hood shooter was something other than an Islamic terrorist).

Yet even though the start of the recession can't be ascribed to Obama's policies, the failure of our economy to turn around is entirely his own.

When he was inaugurated almost nineteen months ago, Obama had an abundance of political capital. He had been elected almost three months earlier with the largest popular mandate of any president in twenty years; as a result of his personal charisma and the enthusiastic grassroots movement that propelled him to power, he had a staggeringly high 64% approval rating; and he had majorities in both houses of Congress that, combined with his personal popularity and the nationwide demand for drastic action, were more than sufficient for him to successfully initiate even highly ambitious legislative measures.

Even better, Obama had templates from recent history to which he could refer for guidance. The last president who had to deal with a similar economic crisis, Franklin Roosevelt, recognized that the root of the problem was high unemployment and declining incomes; as such, he alleviated much of America's suffering during his first two terms with a series of programs known as the New Deal, which put millions of people to work (see the National Industrial Recovery Act of 1933) and helped raise average income levels by empowering labor unions (see the Fair Labor Standards Act of 1938). Indeed, the fact that unemployment and poverty weren't reduced even more during the first eight years of Roosevelt's tenure was due to the reluctance of even liberal Democrats to spend too much money on his New Deal policies. Once World War Two began, and Roosevelt was able to use the war effort as a pretext for increasing the budget and scope of his program of national economic mobilization so that it could reach its fullest potential, unemployment dropped dramatically, from as high as 14% in 1940 to less than 2% three years later.

Yet despite the fact that Obama knew what had to be done and had the tools at his disposal with which to do it, he failed.

The reason for this is as simple as it is devastating: Barack Obama's historical memory did not go back far enough.

To briefly elaborate:

1) From the beginning of Franklin Roosevelt's presidency in 1933 to the beginning of Ronald Reagan's presidency in 1981, the prevalent assumption in American economic life was that the government had an obligation to intervene in economic matters on behalf of middle-class and working-class citizens, from curbing the excessive power of big business and Wall Street to protecting the rights of consumers, stimulating job growth, and fighting for livable wages and humane working conditions. What's more, Democrats insisted on winning elections through the aggressive use of economic populism, depicting themselves as friends of the working and middle classes and characterizing Republicans as tools of the wealthy and a corporate oligarchy. As a result of the beneficence of their policies and the shrewdness of their political strategy, Democrats won two-thirds of the presidential elections from 1932 to 1976, dominated both houses of Congress during that same period with only a handful of brief interruptions, and presided after the end of World War Two over more than three decades of virtually unbroken economic growth (only briefly hiccuped by the oil crisis of the '70s). Roosevelt himself became so popular that he earned the distinction - never matched before or since - of being elected to more than two terms, each time with his popular support never falling below 55%.

2) The last Democratic president to be elected as an unabashed liberal was Jimmy Carter in 1976. Following the failures of his presidency - particularly his difficulty in solving the Iranian Hostage Crisis and fighting the economic effects of the oil shortage - Carter was defeated in the election of 1980 by a Republican named Ronald Reagan, who came from what was then the extreme right-wing of his party. Since that time, conservative economic assumptions had dominated American political life. The Republican Party abandoned the position of the moderates who had dominated their party post-FDR (as seen by every candidate from Alfred Landon to Gerald Ford, with only Barry Goldwater briefly interrupting that string) and instead subscribed to the notion that government spending on the economy to protect consumers and the jobs and wages of the working classes was always bad, if not downright un-American (although they did not object to spending increases for the military, the war on drugs, culturally conservative programs, and tax cuts and financial giveaways for wealthy individuals and businesses, and the consequent exploding of the budget deficit that came as an inevitable result of all of this). This philosophy was not inherently helpful for Republicans: Despite running against an incumbent who was reviled for his perceived ineptitude, Reagan only received 51% of the popular vote against Jimmy Carter during his first run for the presidency in 1980; when he implemented his conservative economic agenda during his first term, it triggered the worst recession in decades, one that lasted two years and was only relieved by the technological boom brought on by the PC revolution and its resultant temporary recovery; this stroke of good luck (unrelated to any Republican policies) helped Reagan recover his abysmal approval ratings and get resoundingly re-elected in 1984; and then his party had further good luck in 1988, when the Democrats nominated a weak candidate, Michael Dukakis, whose naivete about national politics caused him to turn a 17-point lead over Reagan's heir apparent (George H. W. Bush) into an eventual 9-point loss.

3) Then, in 1992, the Democrats chose as their standard-bearer Bill Clinton, who promptly waged a campaign based on the erroneous premise that the last three presidential elections had been lost because Democrats challenged the ascendant Reaganite economic assumptions as opposed to embracing milder versions of them. Because Clinton's opponent, President George H. W. Bush, was saddled with a terrible economy and a third-party spoiler who siphoned off huge chunks of his base, Clinton wound up winning the election despite receiving only 43% of the popular vote (the lowest amount to go to a victorious candidate in twenty-four years). Clinton in turn pursued economic policies from the center-right, in what he believed was a politically viable halfway point between the FDR liberalism that worked and the Reagan conservatism to which he believed Democrats had to make automatic concessions. Like Reagan before him, Clinton lucked out; a technological boom that had nothing to do with his own policies caused economic growth and led to his re-election (ironically, that techno boom was directly connected to the actions that his vice president, Al Gore, had taken while he was still a Senator from Tennessee; see the High Performance Computing and Communication Act of 1991). By the time Clinton's re-election in 1996 had given way to the scandals that marked his second term, the message had nevertheless been sent to Democrats with faulty historical memories - the way to win elections was to abandon, or at the very least serve as apologists for, economic liberalism.

Hence Barack Obama's mistake: He looked to history for guidance and learned from the age of Bill Clinton when he should have learned from the age of Franklin Roosevelt. As soon as he was sworn into power, Obama should have declared that he was pursuing a policy of national economic mobilization akin in structure and scope to that pursued by Franklin Roosevelt during World War II, or at least during the early stages of the New Deal. Instead he chose the Clinton strategy of finding a middle ground between what would work and what the prevailing Reaganite paradigm would accept.

The reasons for following in the Roosevelt path were great: It would undoubtedly have caused a significant reduction in unemployment, increased wages, caused an economic recovery, and gone a long way toward getting Obama re-elected in 2012. Because Democrats had supermajorities in both houses of Congress, Obama could easily have passed all of the legislation needed without any Republican support. The worst with which he would have had to grapple were the gripes of conservative Democrats, but (a) given his high popularity at that time, it is doubtful that many of them would have wanted to oppose him when he was at such a peak and (b) had they managed to thwart his initiatives, or had they fought too aggressively to water them down, Obama could have easily turned to his advantage by characterizing conservatives Democrats as obstructing recovery in the name of their allies on Wall Street, thus parlaying his own popularity and the growing hatred of Wall Street into populist pressure on conservative Democrats to tow the party line, which would have not only guaranteed the passage of the necessary legislation but enhanced Obama's image as a strong political leader. Finally, and perhaps most importantly, it would have solidified Barack Obama's place in history as a transformative president; since his actions would have undermined the ideological assumptions that had kept the previous dominant political coalition (i.e. the one forged by Ronald Reagan in 1980) in its ascendant position, he could have reshaped the American ideo-political paradigm in his image, as had the other transformative presidents before him (Thomas Jefferson, who shaped the political era from 1800 to 1828; Andrew Jackson, who shaped the political era from 1828 to 1860; Ulysses Grant, who after the interlude of the Civil War and the Andrew Johnson debacle shaped the political era from 1868 to 1901; Theodore Roosevelt, who shaped the political era from 1901 to 1920; Warren Harding who shaped the political era from 1920 to 1932; Franklin Roosevelt, who shaped the political era from 1932 to 1980; and Ronald Reagan, who shaped the political era since 1980).

The arguments for avoiding the Roosevelt path were almost pathetically weak: Those who asserted that it would deny Obama bi-partisan support ignored that the post-Gingrich Republican Party has made refusing to work with Democratic chief executives a tactical imperative, thus making any effort to win their support inherently doomed; those who claimed that it would have led to Obama being accused of socialism forgot that (a) the regular voters who would say that are right-wingers who would never vote for a Democrat anyway and (b) conservatives make that charge of Democrats regardless of their ideology, as seen by the fact that they claimed this of the centrist Bill Clinton just as they did of left-wingers from Franklin Roosevelt to Jimmy Carter, which means that Obama was guaranteed to be attacked on that basis no matter what he did; and finally, those who pointed out that Obama's policies would have raised the budget deficit (the one quasi-legitimate claim) overlooked that (a) the long-term harm caused by increasing our budget deficit is much less than that caused by persistent high unemployment and low incomes and (b) once the economy had recovered, taxes could be increased (especially on big businesses and the wealthy) so as to gradually pay off the deficit, since by then the economy would be able to afford it.

Yet instead of following both common sense and the lessons of recent history to their logical conclusion, Obama chose the Clinton path instead of the Roosevelt one:

1) Although he passed a stimulus package to create jobs, he watered it down in order to win the support of conservative Democrats (which he mostly got) and Republicans (which he did not get), thus reducing it to a size that still guaranteed its ability to prevent more severe economic decline (which it did indeed do, a feat that has not received adequate credit from either ideological side) but rendered it woefully inadequate to the task of fostering actual economic growth and recovery.

2) He shifted his focus away from the issue of creating jobs and improving working class conditions and instead spent the remainder of his political capital on health care reform. Although this was undeniably an important issue, and one to which Obama's ultimate legislation has made great strides toward resolving (once again, much more so than many on the left as well as the right are willing to acknowledge), it was not the central issue confronting his presidency, and as such should have been tackled by him later in his administration.

As a result of Obama's failure, the economy is still faltering, the American people are still suffering, and the likelihood that these variables will lead to the nomination and election of Mitt Romney becomes larger every day.

This doesn't mean that political salvation is impossible for Barack Obama. A recovery could occur at the last minute for him, due to a technological revolution or some other external stimulus, much as one did just in time to get Ronald Reagan re-elected in 1984 and Bill Clinton re-elected in 1996; an unrelated crisis could cause people to rally around Obama and overlook his failures on the economic front; he could, after suffering terrible losses in the mid-term elections of 2010, be confronted with a Congress so bloodthirsty in hounding him that he could receive de facto support from a sympathetic public, or likewise have a Congress so radical and/or obstructionist in its actions that he can then pass blame for our economic woes onto them.

Of course, the sad truth made evident in all of these hypothetical scenarios is that none of them would be the result of any actions Obama himself had taken. When an individual in power finds that his actions can no longer impact his fate, it is proof that he has failed as a leader.

The reality is that it is too late for Obama to pass the drastic legislation necessary for our economy to experience a meaningful recovery by 2012. While the law of boom-and-bust in economic cycles does guarantee that, eventually, we will get out of this muck on our own, there is no telling when that will happen, although history suggests a recovery will probably naturally occur in the middle of this decade, in what would either be Obama's second term or his successor's first. Either way, Obama's hopes in 2012 rest on the occurrence of a miracle, and while miracles are always possible, they are hardly variables which should be factored into serious political forecasts.

As such, the prediction with which I am compelled to leave this blog is that:

a. Republicans will wisely nominate Mitt Romney as a candidate whose business resume makes him the ideal opponent to a Democratic incumbent dealing with a weak economy (incidentally, his pro-business policies will also help him create a formidable fundraising apparatus to propel his candidacy, an invaluable asset in any successful presidential campaign). Helping his cause will be the fact that independent voters, who will no doubt be turned off by the radicalism of the Tea Party movement and further dismayed with what I expect to be the rabid political bloodlust of congressional Republicans (see, will perceive Romney as an ideological moderate and advocate of political stability, thus making him far more attractive in a general election contest; this factor will not go unnoticed among GOP primary voters when they compare him to his two chief opponents, Sarah Palin and Mike Huckabee.

b. Mitt Romney will run a campaign that focuses on Obama's failures in addressing the economic issues confronting most Americans and contrasts that record with Romney's undeniable acumen as a business guru (which he will argue recommends him for a political job requiring successful economic policies), as well as his success in balancing the state budget of Massachusetts and implementing other fiscally conservative programs in that bastion of liberalism.

c. As such, the presidential election of 2012 will become a showdown between Mitt Romney and his running mate (someone pre-approved by the Christian Right, palatable to the Tea Partiers without being viewed as in their pocket, and with federal experience in contrast to Romney's considerable lack thereof, such as Richard Burr (my personal pick), Fred Thompson, Sam Brownback, Jeb Bush, or - if Romney's an idiot - Newt Gingrich) and Barack Obama and Joe Biden (despite rumors to the contrary, I doubt Biden will be replaced, as the process of purging him from the ticket would provide more drama than it'd be worth). Unfortunately, if things continue on their current track, the probability is that Romney-Thompson/Brownback/Bush would defeat Obama-Biden in that contest.

Unfortunately, should any this scenario come to pass, the only person to be blamed for the president's current plight would be himself.


Sean said...

Whereas your logic is sound and you make a very convincing argument, I will have to disagree with you that Romney will be the de facto winner in 2012 simply because Obama failed on so many counts. There are a few points that I would like to bring up, the first and, in my opinion, most glaring omission of yours is Romney's affiliation with the Mormon church. Yes that places him on the religious right, but many
Christians (even brainwashed conservative single issue voting ones) are distrustful of Mormons. This would be a detriment to his campaign much in the same way that Obama's weak record would be, but Obama (forgive me for saying this but it is true) has the benefit of fame, fame for being the first black president. This will serve him just as well in 2012 as it did in 2008, there are an abundance of people who will vote for him because of that fact, and yes there are those who will not vote for him because of this as well but that number is significantly lower than the former. Also, Obama's grassroots movement will be out in full force, and even though Republicans will have learned from 2008 I seriously doubt they will have the same well organized tactics for a computer based campaign as the Democrats will.

All this being said I agree with every point you have made, I just think we will be seeing another election akin to 2000 where the results are, and will be, too close to call until all the chips are in (forgive my use of such a cliche one liner but I feel it appropriate in this situation).

Matt Rozsa said...

1) I do not doubt that Romney's Mormonism will be a variable in 2012 (which I feel is tragic), but there are several factors that will mitigate its otherwise deleterious effects on his candidacy:
a. From a purely policy standpoint, it would not put Romney in a position that is inconsistent with the views of the ideological base whose support he'll need to garner the GOP nomination.
b. Independents, whose support Romney will need to win in the general election, quite likely aren't going to care about his religious background.
c. Romney's other attractive political qualities will likely overshadow his religious background in the eyes of both primary and general election voters.
d. Although anti-Mormon bigotry remains a deep stain in American life, the people who are likely to be turned off from Romney due to his Mormonism (i.e. the Christian Right and other radical right-wing factions) are likely the same ones who're already more repelled by the fact that Obama is black (or who believe, erroneously, that he is a Muslim, which would likewise be perceived by them as worse).

2) While I agree that the allure and sense of purpose that came with the prospect of voting for our first black president definitely benefited Obama in 2008, I feel that this will be less of an advantage for him four years later. In part that is because the novelty of the concept of a black president has worn off; in part it is because, for the independents who are genuinely dissatisfied with his performance, a desire to improve the direction of our country will matter more than anything else.

3) Likewise, I think you are wrong about the strengths of the grassroots movements each candidate would have at his or her disposal. It is always much easier to electrify a political base by giving them something to oppose than by asking them to support the status quo; thus, in the same sense that it was easy for Democrats to mobilize in 2008 when the status quo was eight years of George W. Bush, so too will it be easy for the right-wing to mobilize their troops in 2012 when the status quo is four years of the man they claim is a Socialist hater of America, Barack Obama. Conversely, the task facing President Obama - i.e. having to enthuse his base into an effective grassroots movement from the position of incumbency instead of inspiring challenger - is inherently fraught with difficulty. While this would have no doubt been the case regardless of his performance in the White House, it is rendered doubly so by the fact that he has very little in the way of substantive and well-advertised achievements that he can point to as validations for maintaining the status quo as it has been during his tenure (note my use of the term "self-advertised").

Matt Rozsa said...
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Matt Rozsa said...

A quick update:

Unknown to me at the time when I made my latest revisions to this article (today, on August 29, 2010), an editorial was published in "The New York Times" by Laura Tyson, a member of President Obama's Economic Recovery Advisory Board, in which she advocated the following policy measures:

"Two forms of spending with the biggest and quickest bang for the buck are unemployment benefits and aid to state governments. The federal government should pledge generous financing increases for both programs through 2011.

"Federal aid to the states is especially important because they finance education. Although the jobs crisis is primarily a crisis of demand, it also reflects a mismatch between the education of the work force and the education required for jobs in today’s economy. Consider how the unemployment rate varies by education level: it’s more than 14 percent for those without a high school degree, under 10 percent for those with one, only about 5 percent for those with a college degree and even lower for those with advanced degrees. The supply of college graduates is not keeping pace with demand. Therefore, more investment in education could reduce both the cyclical unemployment rate, as more Americans stay in school, and the structural unemployment rate, as they graduate into the job market.

"An increase in government investment in roads, airports and other kinds of public infrastructure would be cost-effective, too, as measured by the number of jobs created per dollar of spending. And it would help reduce the road congestion, airport delays and freight bottlenecks that reduce productivity and make the United States a less attractive place to do business. The American Society of Engineers has identified more than $2.2 trillion in public infrastructure needs nationwide, and a 2008 study by the Congressional Budget Office found that, on strict cost-benefit grounds, it would make sense to increase annual spending on transportation projects alone by 74percent.

"Over the next five years, the federal government should work with state and local governments and the private sector to finance $1 trillion worth of additional investment in infrastructure. It should extend the Build America Bonds stimulus program, which in the past year has helped states finance $120 billion in infrastructure improvement."

The good news is that these measures would further improve our economic situation.

The bad news is that:

A) They are being proposed about nineteen months too late, since President Obama no longer has the political capital needed to make the full passage of such legislation feasible.

B) These measures are still inadequate to what will be required to not only mitigate the suffering caused by this recession, but to turn it around into a full-fledged period of prosperity. For that, we need reforms along the lines of the National Industrial Recovery Act of 1933 and the Fair Labor Standards Act of 1938, as well as a comprehensive program of economic mobilization comparable to that used during World War Two. These policies chip away at the edges of our problems but do very little to bring about a real end to this economic crisis or make lasting changes in the future.

This underscores the key difference between American conservatives and American liberals - while the former have little hesitation in being bold in their visions and aggressive in the means which they use to effectively implement them (see Ronald Reagan, George W. Bush), liberals in the post-Reagan era have taken to being timid in both what we propose to do and how we go about trying to do it.

Machiavelli understood it best:

"It is better to be bold than too circumspect, because fortune is of a sex which likes not a tardy wooer and repulses all who are not ardent."

Matt Rozsa said...

PS: The three posts that I deleted had included the full text of Tyson's piece. I ultimately decided, for the sake of brevity, to merely include excerpts of her most salient points.