|
This is part 2 of a two-part diary on two new articles that provide insight into the newly visible weakness of Obama's politics. Although I have serious disagreements with some of their content, their main thrusts are both accurate, they complement one another, and though they reinforce arguments from the left, they both primarily grounded in pragmatist arguments. In part one, I examined "The Character of Barack Obama", by David Bromwich, which was really more about the process side of Obama's politics. In this part, I turn to Michael Lind's critique of Obama's cult-like faith in neoliberalim, asking, "Can Obama be deprogrammed?".
The main thrust of Lind's piece is unassailable: New Deal liberalism worked. Neoliberalism does not. New Deal liberalism produced the broadest prosperity, the largest and most affluent middle class in the history of humanity. Neoliberalism produced a bubble economy in the 1990s that briefly balanced our federal budget, but utterly failed to stop the erosion of our manufacturing base and our rising trade imbalances.
By neoliberalism I mean the ideology that replaced New Deal liberalism as the dominant force in the Democratic Party between the Carter and Clinton presidencies. In the Clinton years, this was called the "Third Way." The term was misleading, because New Deal liberalism between 1932 and 1968 and its equivalents in social democratic Europe were considered the original "third way" between democratic socialism and libertarian capitalism, whose failure had caused the Depression. According to New Deal liberals, the United States was not a "capitalist society" or a "market democracy" but rather a democratic republic with a "mixed economy," in which the state provided both social insurance and infrastructure like electric grids, hydropower and highways, while the private sector engaged in mass production....
The transition from New Deal liberalism to neoliberalism began with Carter, but it was not complete until the Clinton years. Clinton, like Carter, ran as a populist and was elected on the basis of his New Deal-ish "Putting People First" program, which emphasized public investment and a tough policy toward Japanese industrial mercantilism. But early in the first term, the Clinton administration was captured by neoliberals, of whom the most important was Treasury Secretary Robert Rubin. Under Rubin's influence, Clinton sacrificed public investment to the misguided goal of balancing the budget, a dubious accomplishment made possible only by the short-lived tech bubble. And Rubin helped to wreck American manufacturing, by pursuing a strong dollar policy that helped Wall Street but hurt American exporters and encouraged American companies to transfer production for the U.S. domestic market to China and other Asian countries that deliberately undervalued their currencies to help their exports.
Lind is also very astute in capturing how Obama's agenda seeks to elide the deeper economic problems that neoliberalism is not prepared to tackle, and how it seeks to rationalize doing so:
Instead of the updated Rooseveltonomics that America needs, Obama's team offers warmed-over Rubinomics from the 1990s. Consider the priorities of the Obama administration: the environment, healthcare and education. Why these priorities, as opposed to others, like employment, high wages and manufacturing? The answer is that these three goals co-opt the activist left while fitting neatly into a neoliberal narrative that could as easily have been told in 1999 as in 2009. The story is this: New Dealers and Keynesians are wrong to think that industrial capitalism is permanently and inherently prone to self-destruction, if left to itself. Except in hundred-year disasters, the market economy is basically sound and self-correcting. Government can, however, help the market indirectly, by providing these three public goods, which, thanks to "market failures," the private sector will not provide.
But there is another layer that Lind gets wrong-a layer dealing with race from the New Deal forward on the one hand, and the nature of post-50s progressive politics on the other. I'll first review what Lind gets right, and why it's important to advance this perspective, then I'll look at what he gets wrong, and what its significance is.
|
STATE BLOGS
