What Does Barack Obama Really Believe?

Impossible to know, of course.  But this NYT op-ed by Drew Westen has caused a bit of a stir in the liberal blogosphere.  Westen criticizes Obama for failing to lay out a narrative that the People would be able to follow, the way FDR did when faced with a similar crisis:

...when faced with the greatest economic crisis, the greatest levels of economic inequality, and the greatest levels of corporate influence on politics since the Depression, Barack Obama stared into the eyes of history and chose to avert his gaze. Instead of indicting the people whose recklessness wrecked the economy, he put them in charge of it. He never explained that decision to the public — a failure in storytelling as extraordinary as the failure in judgment behind it. Had the president chosen to bend the arc of history, he would have told the public the story of the destruction wrought by the dismantling of the New Deal regulations that had protected them for more than half a century. He would have offered them a counternarrative of how to fix the problem other than the politics of appeasement, one that emphasized creating economic demand and consumer confidence by putting consumers back to work. He would have had to stare down those who had wrecked the economy, and he would have had to tolerate their hatred if not welcome it. But the arc of his temperament just didn’t bend that far.

Westen says a lot of what I've said in my last few posts, and though it's a long piece I recommend it to those of you who are interested.

One of the points he makes is that BHO should have come out swinging right from the start, explaining why the recession was so bad, and putting the blame squarely where it belonged- on right-wing policies and politicians.  And such a style would certainly have appealed to me.
My criticism is a little different, though. I don't think BHO could have come out with guns blazing in 2009 after running for president as a conciliatory guy. So I don't fault him too much for the attempts early on to compromise, when he ran on that. But once it became clear that the Republicans were just not going to compromise on anything, and would be totally obstructionist, Obama was incredibly slow figuring this out. In fact I think he still hasn't figured it out. That he's trying to find a budget compromise that Republicans will accept, after they refused a deal where they got practically everything they wanted on the debt ceiling, is just pathetic. I hope to see him start proposing what he thinks is needed and then fighting for it. But I don't think he will, and like Westen I'm not sure what it is that he really does want- it's very possible that BHO is quite happy with all these budget cuts and practically no taxes. And that possibility is what has liberals really upset.

Obama and the "Failure of Liberalism"

It's very satisfying for a liberal to read the likes of David Frum, former Bush administration and down-the-line conservative who has been purged from the Right for pointing out that the Republican party was getting way too extreme.  I'm sure conservatives feel similar glee in reading liberals who have turned against the Democrats, like Joe Lieberman or Dennis Miller (I'm sure there are better examples- as you can probably guess, "liberals who have been mugged" isn't my favorite genre to read).

Anyway, Frum (who still identifies himself as a conservative) this week writes:

Imagine, if you will, someone who read only the Wall Street Journal editorial page between 2000 and 2011, and someone in the same period who read only the collected columns of Paul Krugman. Which reader would have been better informed about the realities of the current economic crisis? The answer, I think, should give us pause. Can it be that our enemies were right?

And in the second piece he responds to those who point out that the liberals haven't done much to help the economy recover:

My conservative friends argue that the policies of Barack Obama are responsible for the horrifying length and depth of the economic crisis.
Question: Which policies?
Obama’s only tax increases – those contained in the Affordable Care Act – do not go into effect until 2014. Personal income tax rates and corporate tax rates are no higher today than they have been for the past decade. The payroll tax has actually been cut by 2 points. Total federal tax collections have dropped by 4 points of GDP since 2007, from 18+% to 14+%, the lowest rate since the Truman administration.
If so minded, you could describe Barack Obama as the biggest tax cutter in American history.

We have not seen a major surge in federal regulation, at least by the usual rough metrics: the page count of the Federal Register has risen by less than 5% since George W. Bush’s last year in office. Trade remains as free as it was a decade ago.
While the Affordable Care Act itself will eventually have major economic consequences, most of its provisions remain only impending.
Energy prices have surged, but that’s hardly a response to administration policies. Conservatives complain about restrictions on drilling in the Gulf of Mexico, but on a planet that produces 63 million barrels of oil per day, a few thousand more or less from the Gulf will not much budge the price of oil. Rising oil prices are a story about Chinese and Indian consumption and Middle Eastern political instability, not about US drilling or lack thereof.
The Dodd-Frank bill does somewhat curtail the activities of some banks and investment firms. But is it seriously argued that this could be the cause?

Conservatives complain about excess government spending. Fine. But isn’t the evil of excess government spending supposed to be inflation rather than recession? And where’s the inflation?

There’s a strong case for condemning Barack Obama for the things he might have done, but did not do. He might have cut payroll taxes more and faster. He might have pushed for more expansionary Federal Reserve governors. He might have designed a better stimulus. All true. But the things he did do? Texas Gov. Rick Perry today urges us to believe that the economy is gripped by the worst slump since the Great Depression because Obama spoke disrespectfully of the owners of private jets. To which I can only say: Really? That’s the indictment? Really?

Well said.  Paul Krugman is constantly taunting the "Very Serious People" who keep predicting hyperinflation or rocketing interest rates if the US keeps borrowing, while all evidence continues to show neither happening, just as Keynesian economics predicts in a Liquidity Trap.

The biggest problem for liberals now, though, is that nobody in power is listening to us.  So a mainly Democratic government here is thoroughly on board with austerity, which economists predict will lead to a new recession.  Wall Street seems to agree this week.  And the failure of macroeconomic policy is laid on.... the liberals! Because they're the ones in power.  But since the administration is pursuing mainstream conservative policies, the Republicans have contrasted it by calling for a caricature of conservative policies that were way out on the fringes of political thought only a few short years ago.  And true liberals are left shouldering the blame for our liberal policies, which have never been implemented.

So that's Obama's real sin- no matter what policies he pursues, he must realize by now that he'll be painted as a far-out Leftist.  Yet he keeps clinging to the false notion that he can be acclaimed as a centrist.  And in the process of this futile effort he pulls the whole country way over to the Right.  Tip O'Neil wouldn't recognize the Democratic party.  There is no place for liberals to go.

Where is the liberal equivalent of George W. Bush, a politician who unapologetically sticks to principles, doesn't care if the other side hates him, and gets his base energized and voting?  Republicans are loaded with pols like that, and we don't seem to have any.  So Republicans can rule effectively and make things happen- if only their policies were better it would be great!

Austerity it is!

Another aspect of the Debt Ceiling Surrender by the Democrats that I haven't really written about is this: in the short term, while the economy is still in the crapper, we're moving to an austerity budget.  Deficits are going down, though it's not clear by how much yet- it's the opposite of stimulus.

So what I expect to see in the next two years is continued sluggish growth and high unemployment if we're lucky, and a new recession if we're not.

And here's the best part: conservatives can legitimately keep blaming Obama for it!  He's going to sign an austerity budget, but of course not one that's austere enough for their tastes.  Then while I'm arguing that we should have done more stimulus, they'll argue that Democrats controlled the Presidency and the Senate and passed a bill that they said would be good for the country, and it's not.  They'll campaign in 2012 on the talking point that not enough austerity is continuing to cause slow job growth, and Americans are going to listen- after all, this stuff is complicated and people don't have the patience to follow macroeconomic policy, but they'll react to this message: Obama bargained for this, he said we needed to "tighten our belts", and it didn't work.  Time for someone else to try.  President Romney or Bachman is going to urge us to tighten our belts more- none of that sissy tightening BHO proposed!

There could be one other hope in 2012: get progressives jazzed up and excited and turning out in high numbers, as GWB did with evangelicals during his campaigns.  But with this deal and with the President's rhetoric leading up to it, Obama loses the Left.

I can't vote for this guy again.  He's the worst negotiator in the history of politics. 

Must Resist Urge to Beat My Head With a Stick....

Debt Ceiling compromise news looks very depressing.  Reports say negotiators are getting close to a deal, which is better than default I guess, but a lot worse than a clean Debt Ceiling increase.  The terms as reported by Jon Cohn:

- A debt ceiling increase of up to $2.1 to $2.4 trillion (depending on the size of the spending cuts agreed to in the final deal).


- They have now agreed to spending cuts of roughly $1.2 trillion over 10 years.

- The formation of a special Congressional committee to recommend further deficit reduction of up to $1.6 trillion (whatever it takes to add up to the total of the debt ceiling increase). This deficit reduction could take the form of spending cuts, tax increases or both.

- The special committee must make recommendations by late November (before Congress' Thanksgiving recess).

- If Congress does not approve those cuts by December 23, automatic across-the-board cuts go into effect, including cuts to Defense and Medicare. This "trigger" is designed to force action on the deficit reduction committee's recommendations by making the alternative painful to both Democrats and Republicans.

- A vote, in both the House and Senate, on a balanced budget amendment.

Oy.  So the deal is tons of immediate cuts, zero tax increases, and a commitment to more cuts in the future.  There's a triggering mechanism for more cuts if the parties can't agree on more deficit reduction, the idea being that both parties don't want these automatic across-the-board cuts and will have incentive to avoid them.  But I don't see much incentive for Republicans to avoid them- they're fine with across the board cuts and no tax increases.  Liberals are "disappointed".  How about furious???

Any "automatic" trigger has to include tax increases somewhere, or the Republicans have no incentive to do a deal.

This may be premature- maybe Democrats are negotiating harder than reports say, and maybe there'll be something more reasonable at the end of the day.  But if this passes as reported now it really does mark the end of the Democratic party as the voice of the poor and middle class.  There's nowhere else to go, of course (a liberal friend of mine told me the other night that he'd vote for Romney over Obama at this point- I'm not going that far but I'd certainly think about a protest vote for a liberal third party candidate).

In 2000, while he was throwing the election to George W. Bush, Ralph Nader famously said that "there's not a dime's worth of difference" between Al Gore and GWB, so the vote should be for him.  That turned out to be disastrous.  But at least Al Gore was rhetorically making liberal points.  At least he had a track record of supporting left-of-center policies.  Barack Obama had such a track record in the Senate, and the Affordable Care Act was a great accomplishment.  This year, however, he's left the reservation.  If he and Harry Reid sign off on this, there really isn't a dime's worth of difference between them and arch-conservative Republicans.

Losing by Winning

The more I read about the Debt Ceiling crisis, the more it becomes clear that Democrats, expecially the President, have decided that they are finally in sight of winning a political battle.  They're showing the country how crazy and unreasonable the Republicans are: "Look! We're offering them practically everything they say they want, and they still won't take it!  See, they're impossible!". 

So Obama starts with an offer of a deficit reduction package that is tilted 85-15 toward spending cuts, even though the deficit was caused mostly by the Bush tax cuts.  This despite the fact that polls show most Americans in favor of raising taxes on the wealthy to close the deficit.

And I think it's working so far- the Republicans look absolutely crazy to refuse subsequent offers that keep all the Bush tax cuts and just attack a few tax loopholes in exchange for cuts to Medicare and Social Security.  If Democrats can keep pushing hard on this, they might make gains in the 2012 elections.

But look what they've lost! They've ceded all the policy ground to the GOP.  Democrats, including Harry Reid and Nancy Pelosi, are on record supporting plans to solve the deficit problem almost exclusively through spending cuts, and it's rumored that Obama floated an offer to go 100-0 with spending cuts until Senate Democrats shot him down.  To suggest going 50-50, as Bernie Sanders has done, is seen as a wildly radical idea, even though tax cuts caused much of this problem.

So we win the battle but lose the war.  Discretionary spending is going down to levels not seen since the 1970s.  Social Security benefits are going down one way or another, without even a thought to raise withholding from paychecks or start deducting more from high-income earners.  Democrats are suggesting an increase in the age of Medicare eligibility.  If Democrats won't fight for basic stuff, then what's the point?

And in addition to all that, these policies aren't going to work in bringing the economy back according to most economists, and that's what really matters for re-election.  Democrats might end up losing the politics as well as the policy.  But for this liberal it's hard to even care about the politics- may as well lose now, if winning looks like this.

Debt Ceiling and Some Rambling Thoughts on Hilary & BHO

Great piece here by Ross Douthat in the NYT.  He's a conservative columnist who makes the interesting point that Republicans didn't plan their endgame in the Debt Ceiling talks.  They've been so completely uncompromising that Obama can't possibly acede to their demands (can he?), but in pleasing the Tea Partiers they may lose everyone else in the end.

When I think about the deal that Obama was offering, as a liberal I'm glad they didn't take it.  I think BHO gave away the store.  Maybe he knew the GOP wouldn't take it, but I don't think so- as I've said before, I think Obama believes his own rhetoric about bringing people together, even in the face of all evidence to the contrary. 

I hereby officially declare that I think Hilary would have been a better president.  I was not a fan of hers in 2008 and preferred BHO (I think I voted for Edwards in the primary, but I honestly can't remember).  One of my main issues with the Clintons is their obsession with triangulation and finding the center of the debate, but I'm shocked to find Obama seems more obsessed with finding the right-of-center part of the debate and staking that out in his quest for a deal.  He just doesn't seem willing to stand up for anything- he offered to cut Social Security and Medicare in the current negotiations, in exchange for closing tax loopholes that should be agreed to by anyone.  Luckily the Republicans can't take yes for an answer.

The Republican Party Split

I've been reading lately about the GOP split looming between the Wall Street low taxes crowd and the Tea Party nuts who want the US to default on its debt.  As the Debt Ceiling default gets closer, it seems that Republican elites are starting to worry that they've joined forces with people who are just too crazy to ally with.  This portends a possible breakup of the coalition that has been very successful- old-time economic conservatives allied with Christian evangelicals, who seem to be the people doubling as Tea Party crazies now.

The coalition has worked because the populists in the heartland and South cared about different stuff from the moneyed coastal types.  The elites could live with abortion and gay rights restrictions as long as they got their low taxes.  They even converted lots of evangelicals, who really shouldn't be low-tax types (I don't think there's anything in Jesus' teaching about lower taxes creating economic growth, after all), but are now into it hook, line, and sinker.

So while I enjoy my wistful hopes that this will destroy the Republican party (I know, I know- not very likely but a guy can dream), I'm reminded of some conventional wisdom that has turned out to be wrong.  We warned in 2010 that the Tea Party was nothing more than the same old Republican party recycled, that they would just be "don't tax but still spend" politicians once they got in there, or that they would be co-opted by the power of Washington and would continue to run up deficits just like Republicans have been doing for 30 years.

But it seems to have turned out a little differently.  To their credit, the Tea Party House members are sticking to their guns and demanding lots of cuts to government.  They're also sticking to their guns on taxes of course.  They've never said they would compromise in congress, so they're sticking with their principles there too in refusing to deal with the fact that the House is only one half of one branch of government and they have to deal with other powers in order to govern.  In short, they're everything they said they'd be, much to my surprise.

The problem is that the implications of what they said they'd be aren't any better than if they were just plain old-fashioned Republicans.  US default would be a big deal, and seems to be a possibility.  Responsible Republican elites had better sit up and realize what they're reaping.