Tuesday, January 26, 2010

The Big Picture: Twelve Facts Of Our Time

During the first half of last year, we liked to comfort ourselves that everything would work out for the success and continuing popularity of President Obama and his agenda because of the Three Big Truths:

1) Obama was personally very popular, both broadly and deeply.

2) The Republican Party was deeply unpopular.

3) The moment - an economic crisis caused by big banks and a right-wing anti-government political establishment - meant that people were extraordinarily open to a major course correction.

However, a series of new facts - combining and multiplying their effects in a vicious loop - have emerged to radically undermine any confidence that Obama and his agenda will be successful.

Two Facts that were obscured by the singular catastrophe of the Bush Administration and the excitement of the very long presidential campaign:

1. As Obama was inaugurated, the American public remained deeply uninformed about the most basic elements of politics and economics.
Actually, worse than uninformed, they are misinformed - partly by intentionally lying politicians and partisan media, partly by lazy, shoddy conventional wisdom from the mainstream media, and partly by listening to their own common sense which makes sense in the relative simplicity of their daily lives but is nonsensical with all the externalities and unintended consequences of our very complicated society. Three crucial examples are the power of the President, the relative size and significance of different items in the budget and deficit, and the causes of economic growth and decline.

When it comes to the power of the President, both sides of the partisan divide actively mislead the public that he has much more power than he actually does under the Constitution. Lazy shoddy media is always saying what the President did or didn't do, failing to account for the power of Congress. And the public thinks, "clearly the President is the most powerful person, he's the one I should hold responsible for what does and doesn't happen" - which is common sense, but in fact often untrue.

In terms of the budget and deficit, the partisan sides are always harping on some hot-button issue, radically inflating its importance out of all proportion to its actual size in the budget (see: earmarks, the deficit, and for Democrats, "tax credits that ship jobs overseas"). The lazy shoddy media fails in its most basic responsibility: to provide the proper perspective. There is rarely a proper point of comparison, universal standards are not upheld (sometimes budget items are reported for 1 year, sometimes for 10 years; sometimes total costs are in unfunded mandates, others are paid for) - and these are CRITICAL differences. And for the public, all the numbers are so impossibly large that, as study after study has shown, people have no real sense of the difference between say $100 million over five years and $600 billion in 1 year. It's all just a lot of money. People are always prone to the "that may not sound like much in Washington, but it is to you and me" argument in favor of cutting something. It all amounts to selective deficit disorder.

And with the reasons for economic growth, the midpoint of the two political parties would hold that tax cuts and deregulation are the crucial engines, inequality and small government are great for economic growth, and that you should symbolically cut social service money to show fiscal discipline in a recession to somehow restore growth while leaving massive and much more wasteful expenditures (the military budget) alone. The media fails to explain that the government should reduce deficits in a time of growth and increase deficit spending during a recession, that tax cuts are generally not nearly as efficient as targeted spending with high-multipliers, and that we've had our best growth when we had more economic equality, more government spending, more regulations, and a more unionized workforce to boot. The media highlights government waste and ignores all the good government does. And the American public thinks that because they need to tighten their belts when their paychecks diminish, that this daily-life common sense applies to the government. But common sense here is dead wrong. And people usually see government in the most annoying and mundane elements of their lives - taxes, the DMV, the post office, the bus, because government provides all the services that can't make a profit- negatively impacting their perception. And people tend to remember the one bad event over the ten satisfactory encounters. These have much worse effects on public perception of the government than private business because few people see their encounters with every different private entity as one cohesive "private business", but all government encounters are with "the damn government".

This uninformed state has been growing worse and worse for decades and was definitely NOT ended by the earth-shattering events of 2008.

2. The government is functionally incompetent because of the power of the filibuster and the hold in the U.S. Senate
The Strike and Ezra Klein have had much to say about this still-largely-unknown fact, and I won't repeat what they have said. Suffice to say, it is nearly impossible to pass even minimally effective policy when dealing with the filibuster and the hold. There are just way too many hoops to jump through, way too many opportunities for grandstanding and hostage-taking.

Two Facts which Barack Obama successfully campaigned against, but which remained as true after his election as before:

3. Powerful entrenched interests which benefit from the status quo possess enormous influence to stop any change that threatens their bottom line.
The most obvious facet of this influence is how corporations and the wealthy can use raw money to own politicians, federal bureaucrats, and the media - a full "regulatory capture". But perhaps even more significant is "intellectual capture" - corporations, especially Wall Street, are so influential that they set the terms of the debate, they define conventional wisdom; most insidiously, they set the outward limits of the possible, so that many possible solutions to our problems are just automatically off the table. It's almost funny to look back at the Democratic primaries when Obama and Edwards were debating how you deal with powerful interests - Obama said they must become part of the solution, Edwards says you have to fight them. But neither admitted the much more important fact that whether a President uses negotiation or confrontation, it doesn't really matter. The powerful interests have the muscle to fend off either approach.

4. A significant majority of Congress is motivated ONLY by a) the desires of their powerful owners and b) taking the path of least resistance to a comfortable re-elected, based on the most cynical of political calculations: subscribe to conventional wisdom and appeal to the electorate's most knee-jerk, fearful, prejudiced, selfish, and shortsighted instincts, and you're home free.
This would include pretty much all Republicans and, most devastatingly for us, a large proportion of Democrats. We should have never forgotten this truth about the Democratic Party after the Democrats' disgraceful performance during the Bush Administration: voting for tax cuts and pre-emptive invasions based on lines and anti-consumer bankruptcy bills and right-wing ideological Supreme Court justices and on and on. Democratic base voters' revulsion to this fact was the key reason Obama beat Hillary. But we forgot that her much more beholden, much more cynical Senate Democratic colleagues remained in pivotal positions.

Four facts whose importance we stupidly minimized as they developed last year:

5. No matter what Obama did, the Great Recession wouldn't just help Democrats win in 2008 and then fade away during Obama's first year, but instead would get much worse on Obama's watch
. I didn't come close to fully appreciating how bad things would get, exacerbated by the already-slashed government safety net being even further cut by the recession-accelerating reverse-automatic-stabilizers of state and local balanced-budget requirements. Unemployment and foreclosure and bankruptcies are some of the worst things that can befall people, and they've swept across the country this year worse than any times since the 1930s. And with people being uninformed of what caused the crisis and what would get us out, the seeds were laid for massive anger at whoever was in charge as it was happening. Given that we had long been saying that the American economic system was deeply flawed, that for decades we had under-invested in our people and infrastructure, that the working and middle classes were falling further and further behind, even in "good" times, we should have anticipated a longer and more devastating downturn.

6. The political consequences of the Wall Street Bailout would be far more lasting than we anticipated, dealing a crucial blow to any remaining public trust in government
. Considering that a) immediately afterward government seemed to look as good as ever with Obama's inspiring election and inauguration, b) most of the bailout was actually repaid with interest, c) no one is actually feeling any direct negative consequences of the bailout (the bailout didn't throw people out of their jobs or their homes, unlike many other policies of the 2000s), I didn't think it would have the devastating effect it has had. It seriously increased the degree of difficulty for Obama to persuade the government of his activist-government approach.

7. The federal government's anti-unemployment and anti-foreclosure policies were definitely inadequate
. Basically, we should have listened to Paul Krugman. Back when the stimulus was first introduced, he criticized it as much too small to stop the recessionary cycle, to keep the unemployment rate down, to cover state budget shortfalls. He predicted - with a healthy dose of appreciation for all components of Fact #1 - that the result would be that people would feel that the stimulus, and therefore activist government intervention in general, didn't work. Liberal credibility on the economy would be severely damaged. I wish Krugman wasn't so prophetic all the time.

8. From the day after the Inauguration - and maybe since shortly after Election Day actually - the anti-government, "bailout and stimulus are just big government pork" argument immediately garnered more popular support than Obama's narrative
. This was in large part because Obama didn't ever explain his narrative effectively, as I covered in the last post. And misinformed public opinion was prey to the Fox News/Tea Party simplistic Big Lie narrative. It's important to recognize that this "narrative capture" started very early, even when Obama's approval ratings were high and the Republicans' were in the toilet. As Democrats were seen continuing the Bailout policies and packing a stimulus full of wasteful "pork", the dominant narrative of Obama's administration as "Wall Street Liberal" was set in those first couple weeks.

And now, a year into Obama's Administration, as he tries to turn around his Presidency in tomorrow's State of the Union, we have to face these new Three Big Facts:

9. The anti-government "tea party" message has completely dominated the debate and now defines conventional wisdom; any other viewpoint is barely hanging on to the leftmost inch of the bounds of what's considered possible
. All of the above underlying factors contributed to this new fact, which was driven home with certainty by Obama's horrific proposal to bow to the tea partiers and freeze non-security discretionary spending for the next three years. Even though we have facts and logic on our side, even though we have the appealing, clearly reasonable Obama and the tea partiers are represented by unpopular figures with no intellectual credibility like Glenn Beck and Sarah Palin, and that their way completely failed and caused the Great Recession, they have crushed us in the court of public opinion. Take a minute to let that sink in.

10. The Democratic Party does not stand for anything
. Sure there's rhetoric in the party platform, but this past year, and especially this past week, has clarified that the party is not based in any shared vision of what to do with political power. It was unified in '06 and '08 to get power, but once it has it, there is not even the most basic consensus on what to do. Can you name one proposal that a solid majority of Congressional Democrats would support and proudly advocate? The clearest possible example is refusing to pass health care reform even though Democrats have a huge majority. A large proportion of Democrats are FAR more amenable to voting for funding the war in Afghanistan, unpaid-for, to big tax cuts for the rich, and to maintaining big profits for energy companies, drug companies, health insurance companies, and Wall Street, than to even the most compromised, watered-down shred of the Obama agenda. The result is you have hard-core party loyalists like the Strike and I seriously stating that we don't care whether or not Democrats retain the House and the Senate. Once again, I should have seen this coming - this is the same party and the same people that, as stated above, have only the crassest motivations and showed very clearly what they stood for during the Bush Administration.

11. Without major changes to these facts, it's almost impossible to see how anything substantive can be accomplished in Congress.
I mean, a central plank of the party for 70+ years has been health care reform, and the party had 60 votes in the Senate and a huge majority in the House, and couldn't pass a bill that bent over backwards, over and over again, to accommodate the centrists. So what could possibly be passed through Congress? The combination of misinformed voters, the filibuster and hold, the Cynical Majority in Congress, and Tea Party Narrative Capture renders it basically impossible. If you can think of a substantive accomplishment - even something small-scale and watered-down, as long as it actually improves people's lives - that you think can pass Congress, please leave us a comment with your idea!

One final fact that gives us a shred of hope:

12. We still have a strong majority of the country that voted Democratic, that the polls show support the underlying elements of the Obama agenda; and President Obama is, I think, still committed to getting substantive things done, and still possesses the talent to educate and persuade the public, and the bully pulpit from which to do it

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