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Robert Reich was the most overtly progressive member of Bill Clinton's cabinet. By all appearances, he's also really smart and really nice. Unfortunately, sometimes the two work against each other. Such was the case on Inauguration day, when his post at TPM, "Obama's First Choice", advanced the argument that, although the stimulus needs to be large (his own view is $900+ billion), the price tag "scares" Republicans and Blue Dogs, and that it " may be the smartest politics and smartest economics" to go for the broadest support, even if the result is "a smaller stimulus package - one that may not be enough to jump-start the economy."
Reich explains:
Why would he ever choose the second strategy? Because his goal is not just to get the biggest stimulus package he can squeeze through Congress. It's to get a Congress that's mostly united behind whatever stimulus package emerges. This would ensure that Republicans and blue-dog Democrats take some ownership of the package, and therefore responsibility for making it work.
If they feel ownership and responsibility, Obama could return to them later if more money is needed, and probably get their backing. Just as important, he starts to build bipartisan support for other things that have to be done in the next few months - keeping the U.S. auto industry afloat, reducing mortgage foreclosures, and devising new regulations of Wall Street. And he lays the foundation for a more united Congress capable of tackling a new health-care system, a new system for reducing carbon emissions, and reform of Social Security and Medicare.
I have just one question: what has Reich been smoking? Republicans and blue-dog Democrats feel "ownership and responsibility"?
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One does not have to go looking for eminent experts to counter this. Commentator Matthew Saroff nails it right off the bat:
Sorry, but the idea that the Republicans will buy in and continue to buy in later if they get a crippled bill at day one is frighteningly naive.
Movement conservatives are not afraid that Barack Obama will do something wrong, they are afraid that he will do something right, and in so doing, undermine their message that government is evil.
You peel off enough Republicans to beat a filibuster, and that's it.
Everything in the last 20-35 years of American politics tells us that Saroff is right, and Reich is smoking David Broder's stash.
But, everything in the last 20-35 years of American politics also tells us that it's not that simple. Of course Saroff's logic is correct. But if you follow that logic, then you get accused of "betraying the spirit of bi-partisanship," and the Versailles press falls in line against Obama as fast as it turned against Clinton. It's a trap that Barack Obama has seemingly set for himself, except that he almost certainly assumes that progressives will cave in order to save him from self-destructing on terms that they themselves supported only dubiously, overall.
The problem here is quite stark: On the one hand, Obama can fight for a stimulus package that's big enough to do the job, and earn the enmity of the establishment media, along with the majority of the Beltway establishement. A quick end to his presidential honeymoon. Or he can get a package almost certainy doomed to fail, which means he gets clobbered a little farther down the road, and everyone else gets to say, "Well, we tried to go along with him, and look what it got us."
This is what the options look like from within the Versailles frame. It's what I would call the "politics-as-usual frame", too. But Obama has repeatedly echoed the Versailles frame that perversely and ahistorically casts Democrats sicking to their guns as "politics-as-usual." Right now, with over 80% approval, is the best possible time for Obama to commit to a plan big enough to work, and then dare others to oppose him. But Obama has to want to do that. And there is no sign of that so far. His vaunted commitment to "pragmatism" is put to the test here, because the inside Washington "pragmatism" of getting something passed that everyone approves of is diametrically opposed to the realworld pragmatism of doing something that actually works.
Don't get me wrong. There are times and places where such a strategy--compromise at first to get the ball rolling, then do more down the line--can reasonably be argued for. There are even times and places where it may be the only way. But this is not one of those times and places, as Paul Krugman indicated back on January 11, when he quoted this passage from University of Oregon economist Mark Thoma:
I think the stimulus package is like driving up an icy hill. If you don't have enough momentum from the start and fail to provide enough "stimulus" to get the car over the crest of the hill, you can slide all the way back to the bottom, crashing into things along the way and ending up worse off than when you started. Maybe you can give it more gas along the way if needed without spinning out, and perhaps you can hold your position if you don't make it to the top, and then start again from the higher level, but that's not a chance I want to take when I'm sitting at the bottom wondering if I can make it to the top without wrecking my car -- the possibility of falling all the way back to the bottom and ending up worse off would make me want to start with sufficient momentum and then some. Essentially, I am arguing that there are crucial economic and psychological "tipping points" that must be reached in order for the economic recovery package to be effective (or at least, there's enough of a chance that they exist that they cannot be ignored when formulating robust policy).
Krugman then added:
I'd add that there may also be a political tipping point: if the stimulus package is too weak, conservatives will pile on after it fails to deliver, claiming that the whole concept has been discredited.
I agree with both Krugman and Thoma, and that's why my argument here is not an "ideological" one that Obama should not compromise on principle. Rather, it's a pragmatic one, that Obama should not compromise now on the size and composition of the stimulus in ways that substantially endanger its chances of success.
If we commit to a massive stimulus package, but it's not big enough--or it's too tilted towards unproductive tax cuts--then we can expect the conservative "free market" economic narrative to come roaring back ten times stronger than before. That's why we should all keep Thoma's analogy foremost in mind throughout all these discussions and debates about the stimulus. |
