Source: The New Republic
There are many good things to say about the stimulus bill. But all in all, it wasn't as good as it could be: It's probably too small and too skewed toward tax cuts, and particularly cuts for upper-income people who won't necessarily spend them. The bank bailout is, well, a mystery, but at best a political fiasco. What's the problem here?
I'll give the three obvious answers before saying what I think is the fundamental problem: First, as for the administration, Obama didn't get out on the stump soon enough to explain why government spending is essential, and his Treasury Secretary doesn't at this point appear up to the job. Secondly, the Congressional Republicans either don't know any economics or are willing to put the country at risk to advance their own party's fortune. Third, Senate Majority leader Harry Reid failed again--the previous instance was over the auto bailout--to use the power of his position to win support for Democratic initiatives.
But I think the main reason that Obama is having trouble is that there is not a popular left movement that is agitating for him to go well beyond where he would even ideally like to go. Sure, there are leftwing intellectuals like Paul Krugman who are beating the drums for nationalizing the banks and for a $1 trillion-plus stimulus. But I am not referring to intellectuals, but to movements that stir up trouble among voters and get people really angry. Instead, what exists of a popular left is either incapable of action or in Obama's pocket.
The labor movement, for instance, has not recovered from the split between the AFL-CIO and Change To Win. To make matters worse, the unions themselves--in particularly, SEIU and Unite Here--are rent by division. As a result, the unions have either been on the sidelines during the debate over the stimulus and bank bailout or uncritically backing Obama and Reid. One labor group, Americans United for Change, which is backed by the American Federation of State, County, and Municipal Employees (AFSCME), even ran ads thanking Susan Collins, Olympia Snowe, Ben Nelson, and Arlen Specter for agreeing to back the stimulus bill that they had significantly weakened.
A member of one liberal group, Campaign for America's Future, pronounced the stimulus bill "a darn good first step." MoveOn--as far as I can tell--has attacked conservative Republicans for opposing the bill, while lamely urging Democrats to back it. Of course, all these groups may have thought the stimulus bill and the bailout were ideal, but I doubt it. I bet they had the same criticisms of these measures that Krugman or The American Prospect's Ezra Klein or my own colleagues had, but they made the mistake that political groups often make: subordinating their concern about issues to their support for the party and its leading politician.
What, you might ask, would have been the result if these groups had gone after Obama and Reid--and in the case of the so-called Americans United for Change--the self-appointed centrists? They would have certainly incurred the wrath of the Obama administration. I know this myself. One Obama press person recently asked a mutual acquaintance, "Why does John Judis hate us?"
But they would have also moved the political debate to the left, so that the center no longer resided somewhere in Susan Collins or Ben Nelson's heads, but considerably to their left. Suddenly, a $900 billion bill without the AMT and with expanded health insurance for the unemployed would have looked like a compromise. These angry leftists would have actually done the Obama administration an enormous favor.
What's the basis for my saying this? Look at the last two periods in Americans history where dramatic reforms were adopted--the 1930s and the 1960s (up to 1972). These were periods when the presence of a popular left moved the center away from the laissez-faire, pro-big business right. The experience of the 1930s is particularly relevant now. During the initial years of the Great Depression, there were demonstrations and marches--notably those by the Bonus Army in 1932--but there was also great despair and disunion. The AFL was paralyzed. Communists were battling Socialists. And the absence of leftwing pressure was reflected in the legislation that passed.
I don't just mean during Herbert Hoover's term. When Franklin Roosevelt first came to office, he inspired a great deal of confidence, but much of what he did in the first 100 days was timid and ineffective. He actually cut federal pay, and his bank measures fell short. The National Recovery Administration was devoted to nullifying antitrust laws. Liberals in his administration and in Congress had to pressure him into backing relief for the unemployed.
The economy rebounded largely because of Roosevelt's political skills, but had fallen back in the doldrums a year later. What really made a difference was the Second New Deal of 1935-36 that included massive public works, Social Security, and the Wagner Act. And that Second New Deal was made possible by the growth of a popular left.
In 1934, there was a wave of strikes. Huey Long's Share Our Wealth movement began. In a year, it had organized 27,000 clubs across the country. Francis Townsend organized a movement for old age pensions. As a result, the center of politics shifted dramatically to the left and made it possible for the liberals in Congress and in the administration to pass legislation that under different circumstances Roosevelt would have deemed too radical.
The threat of the left made possible the existence of what Arthur Schlesinger later called a "vital center." Obama might not want these kind of strident critics from the left--who wants a Huey Long thundering against him?--but it's exactly the kind of opposition he and the Democrats need.
This article originally appeared in The New Republic.