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Political Strategy for a Permanent Democratic Majority

The Democratic Strategist

Try “Colonel,” Dr. Bachmann

Dave Weigel is drawing attention to one of those mini-controversies that sometime blow up into a major brouhaha: the occasional habit of Michele Bachmann and her fans of referring to her as “Dr. Bachmann” because she has a law degree.
Like my own, Bachmann’s law degree is that of J.D. or Juris Doctor, literally Doctor of Law. Back in the day, the same degree was normally granted as LL.B., literally Bachelor of Laws. By universal consent, neither title carries with it the right to be called “Doctor,” and that’s why Bachmann is getting barbecued over the pretension.
My recommendation, at least when she is campaigning in the Deep South, is to adopt the archaic custom [warning: the 1939 newspaper article linked to here includes offensive racial language] of my home state of Georgia whereby lawyers used to call themselves “Colonel.” That has a nice military resonance which will help her compete with Air Force Veteran Rick Perry.


A New Economic Strategy for President Obama

This item is a guest post by Sheri Rivlin and Allan Rivlin, Co-Editors of CenteredPolitics.com. Allan Rivlin is also a Partner with Hart Research Associates/Garin Hart Yang.
Now that the White House has announced that it plans to announce a new set of jobs proposals in September we can see it as a welcome sign–but not if it is just an effort to give President Barack Obama a new economic message heading into the 2012 presidential election. Obama doesn’t need a new economic message for the 2012 campaign; he needs a new economic strategy right now, because America needs strong economic leadership today as much as at any time during Obama’s presidency.
Consider these facts:
The economy, stupid: Obama was elected to do just one thing, fix the economy. He hasn’t. The economy is still stuck in that ditch he was talking about last year and there are real signs beyond stock market gyrations that the economy may even be slipping backward. It is certainly not moving forward at an acceptable pace, and the latest Gallup Poll pegs Obama’s job approval on the economy at just 26%.
Small is not beautiful: The sorts of limited talking point proposals the President and surrogates have been mentioning recently will help create an impression that he is doing something about the economy, but that is not the same as actually doing enough to get the economy moving. The US economy and the world economy need bold action to increase liquidity and increase demand. The vicious cycles must be turned virtuous. People need money to spend to create the demand that will cause businesses to hire workers.
Democrats do not know what they believe. Democrats have lost their identity when it comes to economic philosophy, with doubts and divisions about how to balance the need for job creation with concerns about long-term debt. Congress waited all winter, and then all spring, and now all summer for the White House to take the lead on a job creation agenda – and it seems the White House was waiting for Congress to lead. Right now, only Obama can lead the party back to confidence.
The next deadline is now. Many have been focused on the next act in the debt ceiling showdown, as members were named to the “Super Committee” set up to report in November. But federal government funding runs out at midnight on September 30, and the government will shut down unless Democrats and Republicans agree on a new plan to fund FY 2012 which starts October 1.
The Tea Party has peaked. It is clear Obama feels constrained by House Republicans but their influence peaked with the last deal. Some excellent reporting by the Washington Post lets us appreciate the well-planned and executed Republican maneuver to use the vote to raise the debt limit as an opportunity to exert influence over the federal budget. But it was an ambitious act without an encore. The peak moment of Tea Party influence was timed for that conflict but that moment has passed.
Democrats will have all the leverage this fall. House Republicans had all the leverage in the debt ceiling battle because Republicans knew Democrats could not accept the risk of a government default. An October government shutdown would not be so bad for President Barack Obama or House Minority Leader Nancy Pelosi but it would be intolerable for House Speaker John Boehner. (More on this below because it is the key strategic point.)
All of this points to the imperative for President Obama to re-take leadership of the global economy by putting forward a new economic plan that sets a goal not of stopping deterioration, but of returning America to what Americans believe is their right: economic growth and prosperity.
A bold but balanced economic vision. What is needed is a clear articulation of what Obama believes and all Democrats can defend. Both of necessity and providence it must balance the economy’s need for job creation in the short term with realistic plans to control the long term deficit. But it cannot be a compromise that fails to do either well. There has to be enough job creating activity to get the economy moving forward in the next 12 to 18 months – even if there is also enough serious deficit reduction to keep America on a sustainable path over the next 20 to 50 years.
The two goals are not contradictory. Rather, they are mutually reinforcing as President Obama said: “The good news here is that by coming together to deal with the long-term debt challenge, we would have more room to implement key proposals that can get the economy to grow faster.” Democrats need to be bold and creative in making the case for billions of dollars in short term economic job creation. And Democrats must be just as bold in addressing the long term debt in order to have credibility and capital to address our needs today and in the future. We must continue to be willing to make reasonable changes in government programs to keep our promises in line with our resources over the long term. We can and must do both.


Dems Win Final Two Wisconsin Recall Elections

So the Wisconsin Recall Saga of 2011 ended last night with two Democratic state senators hanging onto their seats by relatively comfortable margins. The more vulnerable of the two, Jim Holperin, whose district gave Scott Walker 57% of its vote in 2010, won 54% in the recall election.
In the end, Democrats picked up two seats; narrowed the Republican margin in that chamber to 17-16; and threw a pretty significant scare into Walker (who could face a recall of his own in 2012) and his legislative friends.
Given the circumstances, in which state law prohibited recalls of legislators elected in the GOP wave election of 2010, it was an impressive undertaking with results that fell just short of making major history. Indeed, if the tactics and strategies tested in Wisconsin are deployed successfully by progressives in other states in 2012, the effort may yet make history.


Beyond the Bully Pulpit: Deploying Other Progressive Assets For a Jobs Effort

This item is a guest post by Ralph Whitehead, Professor of Journalism at the University of Massachusetts and a long-time contributor to discussions of progressive politics.
What James Vega says about the bully pulpit as a medium is certainly correct and worth saying. Much of his memo seems to define the bully pulpit too narrowly, as if it consists merely of a single presidential speech or set of remarks or a brief series of speeches on a single subject. Nevertheless, even if we replace this definition with one that is modestly broader and can include multiple appearances to illustrate a common theme, his case still holds.
Although a President’s words can somewhat alter the level of popular support for some policy objectives, they can’t reliably alter it a great deal for every policy objective. As a medium, the President’s voice is not all-powerful. This holds for President Obama, too, no matter how eloquent he has been in the past or will be in the future. So it isn’t true that the bully pulpit per se, if President Obama would only use it, would be the deciding factor in any of a wide range of policy debates. To the extent that Democratic partisans have called on President Obama to use the bully pulpit because they believe that he will be able to use it to this effect, they are wrong. (Also, as Vega might have said of the Republicans, they don’t control the bully pulpit — but recently they have still been able to accomplish a lot of what they have wanted to accomplish.)
However, three sections of the memo deal not only with the matter of the bully pulpit but also with various aspects of the matter of jobs. These sections appear as a number of Democrats are urging the President in effect to launch an effort to put a large number of Americans back to work by first impelling perhaps 30 House Republicans to take the extreme step of voting for a plan to fund public works projects. I worry that Vega’s cautions against the effectiveness of the bully pulpit will be read as cautions also against the effectiveness of such an effort and thus as cautions against the President and the Democrats embarking on such an effort in the first place. If they are read this way, then I want to make the case that they shouldn’t be.
To move 30 House Republicans is obviously a tall order. Democrats won’t be able to do this by mobilizing merely our partisan base in each of those 30 districts. We will also have to address voters who stand outside of our base. Also, it won’t be enough for us merely to persuade such voters to accept the creation of a jobs initiative that would originate in the unpopular federal government. We will also have to get them to support our plan, and to do it actively enough to be willing to urge their respective House members to vote for it. Given what Vega tells us about the bully pulpit, this order is clearly too tall to be filled by just a series of speeches and appearances by the President. But it doesn’t necessarily follow that attempting such an effort must be a fool’s errand.
Some of the proponents of such an effort know how tall an order it is. Also, though they definitely imagine that a heavy use of the voice and presence of the President would be a necessary part of what it would take for such an effort to be successful, they don’t assume that it would be sufficient. What they have in mind for it certainly includes use of the bully pulpit, But it would have to include other assets as well.
For one thing, apart from the role of the President and many surrogates, this effort would include the elements of any serious grassroots lobbying campaign. Moreover, the role of just the President himself wouldn’t rely only on his own voice. He would also begin to go into each congressional districts and use his stature to help gain attention for the voices of people there who are unemployed or underemployed. Given the nature of those districts, a lot of these people are white. Some hold four-year degrees. A lot of others don’t. Literally and figuratively, he would hand his microphone over to them, so that they can describe their own situations. If they wish, they could then, as the case might be, speak for or against the Democratic plan to create public works jobs. As they did so, they could symbolically address their words to their respective members of the House.
If the President is lucky, opponents of the bill would picket his appearances. If so, their actions would constitute large in-kind contributions to his re-election campaign. They would have to report them to the FEC. So his aides should bring along the proper reporting forms and pass them out. Also, the President’s work at the level of individual congressional districts wouldn’t prevent him from appearing at events of national significance. If a job fair attracts 10,000 job-seekers and national media attention, the President should feel free to attend and see if he can persuade some of the job seekers to devote some of their time to supporting the effort to pass a jobs bill.
In such an effort, the prime source of its appeal to voters, both in the target districts and across the country, wouldn’t have to be the bully pulpit. After all, it isn’t supposed to be. The prime source of its appeal is the appeal that a steady paycheck has for people who need one and, for people who don’t, it is the appeal of the benefits of the ripple effects of the decline in the number of their friends and neighbors who need a job.


TDS Co-Editor William Galston: Four Actions the Global Community Must Take to Avoid Another Depression

This item by TDS Co-Editor William Galston is cross-posted from The New Republic.
As they have with the Great Depression, economic historians will argue for decades about the origins of our current crisis. But, surely, we can agree that the failure of international economic cooperation in the early 1930s–and worse, the sequential adoption of beggar-thy-neighbor domestic policies–made matters worse at a time when enlightened statesmanship could have made them better for everyone. Similarly, the current crisis is not just a U.S. problem or a European problem; it is a global problem that requires a coordinated global response. “We’re all in this together” is not a moral bromide, in this instance, but a simple statement of fact.
Since the crash of 2008, the entire world has relied on a shared, if tacit, plan to avert all-out catastrophe and a second Great Depression. The United States would do what was necessary to prevent its financial system from collapsing and stem the economic decline with massive fiscal and monetary stimulus. Europe would cauterize its debt crisis, which threatened the integrity of its common currency, by bailing out its small, insolvent countries (Ireland, Portugal, Greece) while relying on German growth and Franco-German leadership to pull it through. Brazil and India would continue to grow briskly, and China would shore up global demand with a huge investment in public sector spending. And the world would muddle through, albeit with below-normal growth and above-normal unemployment for an uncomfortably long time. In the interim, social safety nets of varying strength would shield the hardest-hit workers and families from destitution, maintaining social stability.
Events of recent days, however, have made it clear that this plan has failed. Growth in output and employment in the United States had slowed well before the inconclusive outcome of the debt ceiling debate gave Standard & Poor the occasion to downgrade U.S. public debt. The European debt crisis has morphed beyond its previous bounds to include Spain and Italy, whose obligations far exceed what the European Central Bank can backstop, and even German growth is now showing signs of flagging. The most rapidly growing emerging economies are slowing and, in most cases, they are experiencing rising rates of inflation. In important respects, the Chinese stimulus was misconceived, with massive sums poured into unproductive infrastructure projects and loans that local authorities cannot repay.
Not only has the post-2008 arrangement fallen short; it has left the world economy less able to meet the current challenge. There is a limit to what central banks can do, and they may be uncomfortably close to it. (The Fed’s portfolio has swollen dramatically since the crisis began more than three years ago.) The indebtedness of most major countries has soared relative to their GDP, increasing market and political pressures for long-term fiscal stabilization. Some countries–most notably the United States–have failed to respond adequately, while others–most notably the UK–have implemented austerity programs, only to be met with social disruption. The famous European social model, which stabilized the continent for two generations, is now in danger (or, perhaps, in the early stages) of being rolled back, with political consequences that are unlikely to be benign.
So what’s to be done? Some elements of the response we need are pretty clear:

1. In the United States, large amounts of household debt (especially mortgages) incurred during the past two decades cannot be repaid, while in Europe large amounts of sovereign debt could be repaid only on terms that would prove ruinous (see Keynes’ sadly prescient 1919 book, The Economic Consequences of the Peace). We need new mechanisms for lightening these debt burdens and allocating losses so that demand-led growth can resume and social stability can be preserved. If institutional creditors take a hit, as they should and will, governments should ensure that they remain adequately capitalized and on track to resume necessary lending when demand recovers.
2. The European Union cannot remain where it is. If its members cannot agree to move forward to more centralized institutions of economic management, then it must move backward by loosening the restraints on member-nations and permitting (or even requiring) individual nations under stress to suspend or terminate their participation in the euro. Argentina, which ceased pegging its currency to the dollar at the height of a debt crisis, may be a better model for Greece than is the IMF-style austerity program its government has been forced to adopt.


A Bully Pulpit Must Sound A Call To Action: A Reply to James Vega

This item is a guest post by Tom Phillips, a retired corporate attorney who contributes to Daily Kos as TRPChicago.
I usually enjoy your Strategy Memos for content, logic and style, but I wholeheartedly disagree with James Vega’s latest piece, “The bully pulpit is not a magic wand.”
President Obama (my wife and I vigorously supported him as contributors and as volunteers in 2008) usually gives memorable speeches, head and shoulders better than anyone else on the political scene today. Yes, he’s mentioned jobs and the economy. And yes, he’s made a lot of appearances this year that focus on how some businesses are doing being innovative. So therefore…we shouldn’t think the bully pulpit has been or can be effective? He has a bully pulpit, all right, but he hasn’t used it.
James Vega’s memo makes several points.
1. The President has been mentioning jobs. But he got mired down in the faux debt crisis and bought the view that government spending was getting out of control. Both he and the GOP mentioned jobs and the economy. I couldn’t tell them apart. But I did hear from him that the deficit was the major thing to attend to now, next year and in the long run. And as for jobs proposals, they got completely drowned out by the debt/government-spending debacle–and I’m worried, very worried, that’s where they’ll stay. As for now, all we’ve heard from the President’s pulpit is a much-criticized, teleprompter-controlled pap-pallid statement to the press proposing patent reform and extending the payroll tax holiday. The former won’t produce one discernible job in my lifetime and the latter is good, but it’s a whisper in the wind, effective next year.
2. He’s made speeches, everywhere: 19 trips to 22 projects. Yes, but mostly in daytime, mostly in the Midwest, mostly to businesses where he tours and talks about how great their efforts are. But most of us are not great. America’s unemployment is at a durable high, in the double digits when you consider how many people have had to take part-time, low-wage jobs. Those aren’t success stories, they’re a frickin’ ongoing crises amidst a moribund economy! President Obama’s proofs of successes on the road are in no way directed to an audience that needs to be moved to action.
3. As for energy, Vega writes: “It is difficult to imagine a much more consistent and continued use of the ‘bully pulpit’ and yet there has been virtually no visible change in the national discussion of clean energy.” The only thing more boring and removed than energy issues right now are climate issues. Energy policy is an area where the Obama administration is making progress, with the new fuel standards and their ringing endorsement by – wait for it! – the auto industry! We will do very well for the American economy if we can innovate in this profoundly important area with technology, new materials and manufacturing techniques. That is a huge victory, but it’s largely behind-the-scenes and in the future. To conclude that the President’s advocacy on energy matters hasn’t affected the “national discussion” seems beside the point.
So, what is my point?
(1) A bully pulpit must sound a call to action, an aggressive and persuasive case for urgent change. A bang! A big bang, several bangs in fact, using the Presidency’s formidable power to persuade (thank you, Richard Neustadt!) and move the American people.
(2) The president needs to put forth a set or sets of proposals — specific, bold, significant and likely to be effective within months after adoption (“shovel ready”). These could include an infrastructure bank, with private and public money, to fund investment in American jobs now and in America’s near and longer-term future, and putting into practice Board-certified Keynesian/Krugman/Friedman populism. Consumer spending will energize the economy, not to mention American households and business opportunities.
(3) Obama must also provide vocal, prominent leadership for his party and the public. (Don’t get me wrong: I’m not suggesting doing a Hillary-on-health-care bill where she presented an 1100 page draft to Congress; that’s too specific.) I am suggesting that President Obama give legislators something to move, and supply specifics for the believers to accomplish … and for non-believers to explain why they can’t be done– something the American people and editorial boards and state and local officials can relate to. Let the nay-sayers vent; we all know who stands taller than they do.
Two times this President recently asked us all to write or call our Congressmen. But what, specifically, did he ask? “Tell them, ‘take a balanced approach’ to the debt debate.” What in the [deleted] is that? The newest Hill intern answering phones in the busiest Hill office could turn that message into a checkmark to support any position, even a Tea Partyist’s! Talk about depreciating the currency from the pulpit.
A presidential call to Congress – and a strategized roll-out to yea-sayers to keep the ball rolling – would energize public discourse. I don’t understand why this White House can’t be as good as Michele Bachmann and Sarah Palin at getting and keeping the attention of the mainstream media–and energizing responsible institutions like TDS in the process.


TDS Co-Editor William Galston: Obama State-by-State

This item is by TDS Co-Editor William Galston.
A Gallup report out today–a 50-state synthesis of the past six months of surveys–provides both a revealing snapshot of Barack Obama’s current political vulnerability and an X-ray of the emerging shape of the 2012 campaign. The report finds that during the first six months of 2011, the president’s national approval ratings averaged 47 percent (it stood at only 42 percent last week). His approval in the states ranged from a high of 60 percent in Connecticut to a low of 27 percent in Idaho.
As the general election nears, the president’s job approval tends to converge toward his eventual vote total. Right now he enjoys majority support in 16 states plus the District of Columbia, totaling 215 electoral votes and trails in the other 34. If an election between Obama and a Republican the people regarded as a credible occupant of the Oval Office were held tomorrow, the president would probably lose.
That’s the snapshot. A finer-grained analysis yields the X-ray. Suppose use the Gallup findings to divide the states into the following categories: (1) Obama won in 2008 and will win in 2012; (2) Obama lost in 2008 and will lose in 2012; (3) Obama won in 2012 but will lose in 2012; (4) Obama lost in 2008 but will win in 2012; and (5) states that are clearly in play based on the combination of the 2008 results and the Gallup numbers.
We can dispose of category 3 quickly: there are no states Obama lost in 2008 that he seems even moderately likely to win next year. Category 4 has one entrant: Obama prevailed in Indiana last time by the narrowest of margins but won’t get close this year unless the Republicans commit creedal suicide during their nominating process. Category 2 (lose in both elections) contains 21 states, including Missouri, in which McCain earned a razor-thin edge but which seems out of reach this time around. Combining 2 and 4, the 2012 Republican nominee will begin with a base of 175 electoral votes.
That leaves the dozen states with a total of 148 electoral votes that will decide the election. Obama carried 11 of them, and McCain just one. I’ve listed then in descending order of presidential approval, with Obama’s 2008 percentage in the next column and the difference in the last.
obama_rating_chart2.png
Some of these results were predictable: states such as Ohio and Pennsylvania are typically within hailing distance of the national total and outcome. (Indeed, John F Kennedy was the last Democrat to win the presidency without Ohio, and no Republican ever has.) Other findings are more surprising and raise intriguing questions:

Is it possible that Obama is stronger in Georgia than he was three years ago? If so, a major investment there could counterbalance the loss of either Virginia or North Carolina.
What’s happening in the Rockies and Southwest, where Obama’s decline has reached double-digits in key swing states? I suspect some combination of disaffection among independents and declining enthusiasm among Latinos.
And what accounts for Obama’s collapsing support in Oregon and New Hampshire? In these states, the desertion of independents is the most likely culprit.

Even at this early stage, two things are clear: The Obama campaign has its work cut out for it. And his strategists had better abandon fantasies of expanding the playing-field and focus their attention and resources on the states without which they are unlikely to prevail. As is so often the case, that begins (though doesn’t end) with Pennsylvania, Ohio, and Florida.


TDS Co-Editor Ruy Teixeira: Obama’s Unhealthy Obsession With Independents

This item by TDS Co-Editor Ruy Teixeira is cross-posted from The New Republic.
The debt ceiling deal has been struck and the score looks to be in the neighborhood of Republicans: a zillion, Democrats: zero. It is perhaps the inevitable outcome of a process in which Obama treated GOP default-threatening tactics as legitimate and accepted the GOP framework that cutting debt, not creating jobs, was the country’s central problem. As a result, we have a deal that severely undercuts Democratic policy priorities and cuts government spending just as the economic recovery is showing signs of tanking. Just how, exactly, did it come to this? The most plausible explanation is that Obama and his political advisors are convinced that striking a bipartisan compromise on debt reduction is the way to the hearts of America’s political independents, who famously abandoned the Democrats in 2010.
Following this logic, Obama’s actions–treating the Republicans’ extraordinary threat not as an illegitimate bargaining tactic but as an opportunity–begin to make a measure of sense. Since independents are supposedly fixated on a bipartisan compromise to reduce spending and cut the debt, Obama would use the leverage provided by the Republicans’ threat, in a judo-like fashion, to enlist both parties in a grand bargain to restore long-run fiscal health. As a result, independents would reward Obama for being, in that tired phrase, “the adult in the room” who stood up for their fiscal priorities.
But it hasn’t worked out that way. As Obama has talked endlessly about a “balanced” approach to getting the country’s fiscal house in order, the economy has continued to stagger and that support from independents is nowhere in sight. Pew data show his approval rating among independents down 16 points in the last few months to an abysmal 36 percent. As for Obama’s re-elect numbers, they have also tumbled, with just 31 percent of independents now saying they would vote to re-elect him, compared to 39 percent for a generic Republican.
To understand how very unlikely it is that Obama’s long sought-after deal is going to magically turn around his numbers, we must visit one of the most robust but amazingly underappreciated findings in American political science: independents are not independent. That is, the overwhelming majority of Americans who say there are “independent” lean toward one party or the other. Call them IINOs (Independents In Name Only). IINOs who say they lean toward the Republicans think and vote just like regular Republicans. IINOs who say they lean toward the Democrats think and vote just like regular Democrats.
Right now, according to Pew data, IINOs are 68 percent of independents, split 36/32 between Republican-leaners and Democratic-leaners, respectively. That leaves less than a third of independents who might really qualify as independent. This figure, in turn, translates into just 13 to 14 percent of adults, and inevitably a lower percentage of actual voters, since pure independents have notoriously low turnout. In 2008, according to the University of Michigan National Election Study, pure independents were only 7 percent of voters.
So how’s the debt deal going to go over with these different flavors of independents? Well, Democratic IINOs and pure independents both are concerned about the job situation over the deficit by a margin of two to one, according to Pew data. In fact, the only part of the “independent” pool that actually thinks the deficit is more important than the job situation are Republican IINOs, who right now give Obama a 15 percent approval rating, the same as regular Republicans. Good luck winning that group over.
But maybe pure independents only say they’re concerned with the economy when their real passion is bipartisan compromises on the debt, and so they’ll ignore the bad jobs situation and turn out in droves for Obama. That’s not likely to happen either. As John Sides has pointed out, voting preferences among pure independents are more influenced, not less, by the state of the economy.
These are the facts, but politicians, and Obama especially, seem to have a hard time grasping them. Perhaps that’s because independents are the Rorschach test of U.S. politics–you see in them what your beliefs and preferences incline you to see. Obama and his team want to see teeming hordes of voters who are above the partisan allure of party, untroubled by the bad economy (or, at least, not planning to vote on that basis), and pining for a Washington where the parties, darn it, just work together. So that’s what they see.
The administration’s chimerical search for the independents of their dreams has not served the country, nor the president, well. Obama has stumbled ever further into a political heart of darkness, hemmed in on all sides by radical GOP views on government and governance. And he can’t expect independents to bail him out.


TDS Co-Editor William Galston: The White House’s Three Biggest Blunders in the Debt Limit Fight

This item by TDS Co-Editor William Galston is cross-posted from The New Republic.
Having spent some time inside the White House, I have some sense of how the world looks and feels from that unique vantage point. Its denizens always have a sense of operating under enormous pressure, subject to myriad constraints. When criticized, White House officials typically respond that they have done the best they could in the circumstances, and that if their critics had been in their shoes, they would have done the same thing.
The more outside observers focus on the immediate situation, the more they will tend to agree with the assessment of the White House. But if we step back and take a longer view, we often see roads not taken that could have led to better outcomes. That’s certainly the case with the just completed debt ceiling negotiations.
As many critics have pointed out, this man-made crisis was entirely avoidable. The Democrats could have raised the ceiling last December. They chose not to, handing a sword to their adversaries. Senate majority leader Harry Reid wanted to force the incoming Republicans to accept some responsibility for the increase. We’ve seen how that worked out. And if President Obama genuinely believed that the Republicans would cooperate because it was the right and responsible thing to do, then naïveté was the least of his mistakes. (A moment of introspection about his own 2006 vote against increasing the debt ceiling should have sufficed to disabuse him of that notion.)
But there are two other less-discussed forks in the road, the first of which occurred just two weeks ago. If news accounts are accurate, the Obama/Boehner talks broke down when the president proposed increasing the revenue component of the grand bargain from $800 billion to $1.2 trillion. Given what he ultimately accepted, $800 billion looks pretty good. (How likely is it that the new congressional committee will be able to agree on anything approaching that figure?) To be sure, we’d have to know more than we do about the other components of the proposed deal, especially the changes in entitlement programs, to reach a solid all-things-considered judgment. And it’s not at all clear that Boehner’s fellow Republicans in the House would have gone along with him on such a bargain, either. But it has been widely reported that the White House shifted its stance only after the Gang of Six made its framework public. If the bipartisan G6 was proposing $1.2 trillion in revenue increases, how could the White House accept less? At the time, that must have seemed like a slam-dunk argument. But it was too clever by half, and the White House ended up throwing away a chance to promote the president’s “balanced” approach to deficit reduction … and, by the way, to drive a wedge into the massed ranks of the opposition.
The most important road not taken, however, occurred many months ago, in December of last year, when the president chose to keep his distance from the recommendations of his own fiscal commission. Suppose he had endorsed its broad approach while making it clear that he disagreed about a number of specifics. Suppose further that he had reinforced that message by featuring it in his 2011 State of the Union address and by using it as the framework for his 2012 budget proposal. If he had done so, he would have had a full six months to build support for his “everything on the table” approach and to rally the American people who, as countless surveys have shown, strongly prefer it to the Republicans’ spending cuts-only strategy.
I have heard of two arguments against this strategy offered by White House officials. First, it is said the president did not want to step forward until after the Republicans had offered their own budget framework. If Representative Paul Ryan remained true to his principles, he would propose huge cuts in popular programs such as Medicare, generating a public backlash, after which the president could return to the fray in a much stronger position. Well, the president certainly smoked Ryan & Co. out. But what did he gain? As of now, I can’t think of anything. Sure, public approval of the Republican Party is way down. But so are his own numbers. And if the debt ceiling deal reflects a weakened Republican Party, one shudders to think of what a stronger one would have done.


TDS Co-Editor William Galston: The Debt Debate is Man-Made Chicanery. Our Stalled Economic Recovery Is Real.

This item by TDS Co-Editor William Galston is cross-posted from The New Republic.
Raising the debt ceiling is a man-made crisis amenable to straightforward policy remedies. Political will is all that is lacking. Not so the economic crisis that our preoccupation with fiscal policy has temporarily obscured. Two major reports underscore both the depth of our economic woes and our increasing social divisions.
The IMF recently conducted a comparative study of ten post-war economic recoveries seven quarters after the business cycle trough, or recession’s end. Its findings for the United States are stunning. For employment and household finances, the current recovery is the weakest since the end of World War Two. For the business and financial sectors, it’s the strongest. The banks, recipients of lavish public funds and guarantees during the meltdown, are reporting a rapid recovery from their lows in profits, loan charge-offs, and equity-to-asset ratios. Meanwhile, growth in employment, disposable personal income, personal savings and consumption, and total GDP all anguish. Needless to say, investment in structures–residential and non-residential–comes in dead last. Were it not for a strong performance in equipment, software, and exports, the current recovery would barely have a pulse. The IMF study does nothing to weaken the increasingly credible thesis that downturns induced by financial crises differ structurally from those in normal business cycles.
At the same time that the business and financial sectors are becoming decoupled from employment and household balance sheets, gaps among different parts of our population are growing. A report just out from the Pew Research Center shows that while the median net worth of all U.S. households declined by 28 percent between 2005 and 2009, the figure was 53 percent for African Americans and 66 percent for Hispanics. And these percentages mask an even more troubling reality: The assets of black and Hispanic households have just about been wiped out. Median net worth in black households stands at $5677; in Hispanic households, $6235. No doubt this reflects the collapse of the housing market, which has hit areas of Hispanic population growth with special ferocity. But it reflects something else as well–high levels of unemployment. According to the most recent BLS report, the jobless rate stands at 11.6 percent for Latinos and 16.2 percent for blacks, compared to 8.1 percent for whites. Using savings to finance necessary expenses, which most unemployed households are forced to do, rapidly depletes modest asset accumulations in a hurry. Overall, the disparity in household wealth has risen to the highest level on record, wiping out two decades of progress for minority householders.
This painfully slow recovery is rending the fabric of American society. In turn, these growing socio-economic gaps are contributing to the rising polarization of our politics and declining trust in government–developments that will make it even more difficult to forge agreements on the policies we’ll need to get out of this deep hole. No doubt adverse trends in the global economy are making things even worse. But in the end, our economic crisis is a governance crisis. The stalemate over the debt ceiling is a symptom of this systemic fact.