Barack Obama’s election to the Presidency still surprises me a bit. Only four years before, American voters clearly rejected the Democratic alternative to the anti-government philosophy that Ronald Reagan popularized. Bill Clinton seemed like such a rejection, but he and his “third way” ideas regarding the social and economic place of government in modern America were not in fact a return to big government. Clinton was “Reagan-lite”; he was still fairly conservative, was still inclined toward small government and low taxes. It was under Clinton that the “bubble economy” got going; it made many people happy for many years (through rising stock prices, rising home values, and rising consumer spending). Then came Bush Junior and Osama Bin Laden, but even the 9-11 tragedy and the subsequent “war on terrorism” couldn’t stop the economic party that was going on in America. Until the final, fateful year of the Bush presidency, unemployment was low, mortgage loans in any amount could be had by almost anyone, gasoline and big SUVs were affordable enough, “must-have” consumer electronic goods were everywhere, and people were generally pretty happy with things.
Thus, in early 2007, it was still quite unimaginable that a relatively inexperienced Democrat with a solid liberal pedigree like Barack Obama could be taken seriously for the Presidency. Well, I should take that back; once we found out just how intelligent and charming Senator Obama was, it was clear that this guy would not go away. But his historic charisma and incredible political skills notwithstanding, it still didn’t seem as though the average American voter had good reason to reject the tried-and-true Republican formula. Despite John McCain’s many blunders (with Sarah Palin perhaps being the most egregious), Obama remained tied with him in the polls only two months before Election Day. The big swing towards Mr. Obama came only after it became clear that the growing economic problems in the banking and real estate sectors were going to affect just about every family in one way or another. Only when it became clear that foreclosure, layoffs, and bankruptcy were becoming a real threat throughout the middle and working classes did the Obama landslide fall into place.
The American public can be pretty dumb; they clearly got duped by continually rising home and stock values and unemployment rates that stayed below 5%. They really believed that nothing could ever go wrong again, and thus did some very risky things with their money and credit. But despite their short-sightedness, when it comes to electing a President, they generally know what they’re getting into. IMHO, they knew that Reagan, Bush, Clinton, and then Bush again meant less government, less tax, and more economic growth (although they didn’t ponder whether the fruits of that growth were being fairly distributed). And with regard to Obama, they knew that voting for him meant more government, and eventually more taxes. They don’t like a lot of government and tax, but when their way of life is directly threatened (which Osama Bin Laden could never do on a nation-wide basis), they become more flexible. Better to have a job and a house and face higher taxes, than the other way around.
My question is whether the public mood will revert back to the Republican philosophies if and when the economy gets better. This will be really interesting to watch in 2012. Hopefully things WILL be better by then; the big government intervention that Obama is now orchestrating with the Democratic House and Senate will do its job (I hope) without imposing crushing levels of federal debt. Could an attractive Republican candidate then come along and argue for a “return to Reagan-like normalcy”?
The American public can be just as fickle as they are short-sighted. I realize that there have been demographic changes favoring the Democrats (including the aging of the Baby Boomers, who are increasingly concerned about securing what they earned during the “go-go years” and preserving their access to other retirement helpers like Medicare and Social Security). But I still can’t believe that the big changes in voting patterns between 2004 and 2008 were driven by these things. The always perspicacious Bill Clinton was right in saying “it’s the economy, stupid”. The American people are indeed stupid in a lot of ways, but they usually know where they stand with the economy; in the short-run, anyway. If a future GOP candidate can recapture the short-run economic ground, then we could be in for more big surprises – as if 2008 didn’t have enough surprises for a generation or so.
One more note on Obama and the new economic order. I was perusing the pundit-of-the-day lists on Realclearpolitics.com this morning and I noticed two different articles by Jeffrey Sachs of the Earth Institute at Columbia U. Both are found in British publications, the Financial Times and the Guardian. Both articles discuss the implications of the Obama fiscal stimulus package (which the House just approved tonight). In one article, Mr. Sachs hailed the package as the start of a new economic era; quote,
One of President Barack Obama’s historic contributions will be a grand act of policy jujitsu – turning the crushing economic crisis into the launch of a new age of sustainable development . . . Obama is already setting a new historic course by reorienting the economy from private consumption to public investments directed at the great challenges of energy, climate, food production, water and biodiversity.
Bottom line here: this is a return to an old historic course, the course of bigger government, much as our nation had from 1932 to about 1982. Mr. Sachs told of how America would regain its world leadership in this upcoming era, but didn’t say a peep about who is going to pay for it all. However, in the other article, Mr. Sachs was less celebratory and more hard-nosed about the bill for it all. Quoting again,
If the present stimulus package is adopted without a medium-term [taxation] plan, it will go the way of the earlier stimulus package and the TARP, yet also put the US into a fiscal straitjacket that could paralyze public sector action in critical areas for a decade or more to come…. there is certainly a cyclical case for deficit- financed public spending, but accompanied by phased-in tax increases to provide proper financing of crucial government functions in the medium term.
Bottom line this time: Taxes need to go up once the economy is out of danger, so we might as well get people committed to that as soon as possible, while they are still in a good mood about government. If we put it off too long there is the risk of an anti-tax revolt halting further government expansion. In other words, Mr. Sachs remembers Reagan and 1982.
Both articles were published on the same day. I thought it would have been more honest of Mr. Sachs to have combined the two themes and weighed them against eachother. Mr. Sachs clearly welcomes the return of big government to America, but worries whether the public will eventually turn against the Obama initiatives much as they turned against the New Deal / Great Society legacy after Jimmy Carter. Mr. Sachs seems to realize what I said above: the American public is fickle, and has only grown more-so in the age of information and instant gratification. Sachs probably also worries about 2012.
(PS – I myself am not against what Obama is trying to do here; I have said on this blog that I am very dissatisfied about where our economy has gone since the Reagan Revolution, with high levels of inequality caused by fast-growing unregulated markets. On the other hand, I worry that big government can cause economic distortions and undue growth burdens because of the “me-first” political influences behind much government decision-making. The European Communist bloc of the 50s, 60s and 70s provided ample evidence of that; socialism is extremely prone to infectious decay from leadership greed. I’m hoping that Obama can put a system in place such that he AND his successors can make long-term, public-oriented decisions about the economy, resisting the usual parochial pressures. If not, then perhaps we should go back to free markets and small government, cruel as the side-effects can be.)
Jim,
Re Obama: My first criticism of Obama was that his first and (only?) experience was with grassroots organizing–and what real good came from that? It’s clear that I must eat my words. Obviously, it is clear that grass roots organizing was the key to Obama’s win.
Second grassroots organization seems to give Obama a sense of what the “ordinary” (or perhaps the plain word “poor” is more appropriate) people are like, what they go through, how they live. Already I have heard Obama call attention to how poor people must live. When did one ever hear GWB do that? In fact, as far as I was concerned, one of GWB’s worst indicators of his being completely unable to empathize in any way with “poor” people was in his parting comments on what mistakes he might have made during Katrina. His comment about whether he should have landed Air Force One or not showed that he was not even in the ball park with regard to empathizing with the people of Katrina even now. Obama (with his grassroots experience) seems to have a better grasp of what the “poor” might be going through when life’s “slings and arrows” hit them.
Third, Obama has already signed an equal pay for women bill. This hits home with me seriously. When I retired some years ago I totaled up all the money I lost when I realized that I had been on an entirely different pay scale than some of the others who were doing the exact same job as I was doing. (And in some cases, to be honest, I tho’t I had done a better job than some [not all] of the others had done.) The money I lost amounted to hundreds of thousands of dollars–and still affects me as my pension was thereby affected also. Since I count myself, if not in the “poor” category at least in the definitely-not-rich category, I found Obama’s signing this equal-pay-for-women bill giving me a sense that at least women working these days will not lose the money I lost.
Fourth, Obama is calling for an increase in volunteer services by the “ordinary” people. I think this is something “regular” people will respond to–ALA the Peace Corps of JFK.
I have to say, in addition, that while I agree with you to a certain extent that many people may vote for a candidate who “looks good” or “sounds good” (the current younger generations seem sometimes to think only in sound bytes and while I also deplore the fact that illiteracy is rampant in the land), I am not quite sure I can agree that the American public is as dumb as you seem to think. You mention THREE times that you think the American public “can be pretty dumb”; the American public is “short-sighted”; the “American people are indeed stupid in a lot of ways.” I simply must disagree with you that your assessment is pretty harsh. People may not be too educated, people may think in sound bytes–I know some of these. However, I’ve also noticed that these very people, while they may not think using the same process(es) I do, they are far from stupid or dumb. Uneducated is not necessarily the same as stupid or dumb; uneducated is just that–lacking knowledge of a subject. Perhaps a improvement in our educational system is what is needed.
Furthermore, I can’t quite agree with you about Reagan. I dreaded his possible election as prez, I did not agree with him or most of his policies when he was prez, and I was in a state of almost despair when it became evident that he was in the stages of Alzheimer’s and all that was done in those years of his presidency was to cover up his condition–so that in the end Nancy was running the country with help from astrologers.
As to your worries about whether eventually the “public will…turn against the Obama initiatives much as they turned against the New Deal/Great Society legacy after Jimmy Carter”: It does seem to me that the New Deal lasted for quite a long time. If I recall correctly, FDR initiated the New Deal back in the late 1930s and early 1940s. I’d say that a run of some 30 years for a program would not be evidence of how “fickle” the American public is; rat
Comment by MCS — January 31, 2009 @ 11:59 am
Jim,
Re Obama: My first criticism of Obama was that his first and (only?) experience was with grassroots organizing–and what real good came from that? It’s clear that I must eat my words. Obviously, it is clear that grass roots organizing was the key to Obama’s win.
Second grassroots organization seems to give Obama a sense of what the “ordinary” (or perhaps the plain word “poor” is more appropriate) people are like, what they go through, how they live. Already I have heard Obama call attention to how poor people must live. When did one ever hear GWB do that? In fact, as far as I was concerned, one of GWB’s worst indicators of his being completely unable to empathize in any way with “poor” people was in his parting comments on what mistakes he might have made during Katrina. His comment about whether he should have landed Air Force One or not showed that he was not even in the ball park with regard to empathizing with the people of Katrina even now. Obama (with his grassroots experience) seems to have a better grasp of what the “poor” might be going through when life’s “slings and arrows” hit them.
Third, Obama has already signed an equal pay for women bill. This hits home with me seriously. When I retired some years ago I totaled up all the money I lost when I realized that I had been on an entirely different pay scale than some of the others who were doing the exact same job as I was doing. (And in some cases, to be honest, I tho’t I had done a better job than some [not all] of the others had done.) The money I lost amounted to hundreds of thousands of dollars–and still affects me as my pension was thereby affected also. Since I count myself, if not in the “poor” category at least in the definitely-not-rich category, I found Obama’s signing this equal-pay-for-women bill giving me a sense that at least women working these days will not lose the money I lost.
Fourth, Obama is calling for an increase in volunteer services by the “ordinary” people. I think this is something “regular” people will respond to–ALA the Peace Corps of JFK.
I have to say, in addition, that while I agree with you to a certain extent that many people may vote for a candidate who “looks good” or “sounds good” (the current younger generations seem sometimes to think only in sound bytes and while I also deplore the fact that illiteracy is rampant in the land), I am not quite sure I can agree that the American public is as dumb as you seem to think. You mention THREE times that you think the American public “can be pretty dumb”; the American public is “short-sighted”; the “American people are indeed stupid in a lot of ways.” I simply must disagree with you that your assessment is pretty harsh. People may not be too educated, people may think in sound bytes–I know some of these. However, I’ve also noticed that these very people, while they may not think using the same process(es) I do, they are far from stupid or dumb. Uneducated is not necessarily the same as stupid or dumb; uneducated is just that–lacking knowledge of a subject. Perhaps a improvement in our educational system is what is needed.
Furthermore, I can’t quite agree with you about Reagan. I dreaded his possible election as prez, I did not agree with him or most of his policies when he was prez, and I was in a state of almost despair when it became evident that he was in the stages of Alzheimer’s and all that was done in those years of his presidency was to cover up his condition–so that in the end Nancy was running the country with help from astrologers.
As to your worries about whether eventually the “public will…turn against the Obama initiatives much as they turned against the New Deal/Great Society legacy after Jimmy Carter”: It does seem to me that the New Deal lasted for quite a long time. If I recall correctly, FDR initiated the New Deal back in the late 1930s and early 1940s. I’d say that a run of some 30 years for a program would not be evidence of how “fickle” the American public is; rather, I’d say the American public gave it a good shot. After 30 years, it would seem to me that a new approach may be appropriate.
And one last comment: You mention Obama’s “landslide” vote. If I recall correctly, Obama did not QUITE receive a landslide vote as such. By POPULAR VOTE Obama did NOT win by a landslide; he won, but not by a landslide. The “landslide” came in the ELECTORAL vote. I think it’s important to distinguish between the two as the popular vote is (to me) more indicative of a “landslide” than the electoral vote.
And a final comment: As to the American public believing what they were told regarding credit and their ability to buy anything and everything that caught their eye: Yes, indeed, they should have known better. However, I do think that a much greater blame (part of the blame) for the “demise” of the economy must be laid at the feet of those “experts” who figured out that they could lump together great batches of seriously under-financed real estate, break the batches into “pieces,” and sell the pieces to investors. It took some thinking to figure that one out–and not necessarily thinking that was concerned about the good of the American people. We can put in this same group those who have taken the initial “bail out” money (that Paulsen pushed through–and that deal had all the earmarks of a serious scam: “Do it NOW!”) and granted themselves some serious money for bonuses.
True, we cannot predict just how Obama’s plans will work out. True, there will be hidden problems in Obama’s solutions to the troubles of the U.S. at this time; such hidden problems are inevitable as ANY attempts anybody makes to solve ANY problems inevitably have their own set of inbuilt problems that will have to be dealt with. However, just because there is a risk involved, just because there will be problems developing from any solution to any problem, does not mean that therefore implementation of new solutions or new approaches to problems should not be taken. Rather, it is the young(er) generations coming up who will have to deal with these situations; and it will be through these generations attempting and implementing their own solutions to the problems of their times that those generations will grow as individuals. That growth is a positive thing and necessary for those people.
MCS
Comment by MCS — January 31, 2009 @ 11:59 am
Jim,
Re Obama: My first criticism of Obama was that his first and (only?) experience was with grassroots organizing–and what real good came from that? It’s clear that I must eat my words. Obviously, it is clear that grass roots organizing was the key to Obama’s win.
Second grassroots organization seems to give Obama a sense of what the “ordinary” (or perhaps the plain word “poor” is more appropriate) people are like, what they go through, how they live. Already I have heard Obama call attention to how poor people must live. When did one ever hear GWB do that? In fact, as far as I was concerned, one of GWB’s worst indicators of his being completely unable to empathize in any way with “poor” people was in his parting comments on what mistakes he might have made during Katrina. His comment about whether he should have landed Air Force One or not showed that he was not even in the ball park with regard to empathizing with the people of Katrina even now. Obama (with his grassroots experience) seems to have a better grasp of what the “poor” might be going through when life’s “slings and arrows” hit them.
Third, Obama has already signed an equal pay for women bill. This hits home with me seriously. When I retired some years ago I totaled up all the money I lost when I realized that I had been on an entirely different pay scale than some of the others who were doing the exact same job as I was doing. (And in some cases, to be honest, I tho’t I had done a better job than some [not all] of the others had done.) The money I lost amounted to hundreds of thousands of dollars–and still affects me as my pension was thereby affected also. Since I count myself, if not in the “poor” category at least in the definitely-not-rich category, I found Obama’s signing this equal-pay-for-women bill giving me a sense that at least women working these days will not lose the money I lost.
Fourth, Obama is calling for an increase in volunteer services by the “ordinary” people. I think this is something “regular” people will respond to–ALA the Peace Corps of JFK.
I have to say, in addition, that while I agree with you to a certain extent that many people may vote for a candidate who “looks good” or “sounds good” (the current younger generations seem sometimes to think only in sound bytes and while I also deplore the fact that illiteracy is rampant in the land), I am not quite sure I can agree that the American public is as dumb as you seem to think. You mention THREE times that you think the American public “can be pretty dumb”; the American public is “short-sighted”; the “American people are indeed stupid in a lot of ways.” I simply must disagree with you that your assessment is pretty harsh. People may not be too educated, people may think in sound bytes–I know some of these. However, I’ve also noticed that these very people, while they may not think using the same process(es) I do, they are far from stupid or dumb. Uneducated is not necessarily the same as stupid or dumb; uneducated is just that–lacking knowledge of a subject. Perhaps a improvement in our educational system is what is needed.
Furthermore, I can’t quite agree with you about Reagan. I dreaded his possible election as prez, I did not agree with him or most of his policies when he was prez, and I was in a state of almost despair when it became evident that he was in the stages of Alzheimer’s and all that was done in those years of his presidency was to cover up his condition–so that in the end Nancy was running the country with help from astrologers.
As to your worries about whether eventually the “public will…turn against the Obama initiatives much as they turned against the New Deal/Great Society legacy after Jimmy Carter”: It does seem to me that the New Deal lasted for quite a long time. If I recall correctly, FDR initiated the New Deal back in the late 1930s and early 1940s. I’d say that a run of some 30 years for a program would not be evidence of how “fickle” the American public is; rat
Comment by MCS — January 31, 2009 @ 11:59 am