As I explained in The
Golden Calf, when Barack Obama was elected, he was rather a disappointment to
anyone whose agenda was calling out and exposing the fallacies of economism.
Obama was elected on a centrist, peacemaker platform, the man who would go to
Washington and bring the partisans together and get them to stop bickering and
act for the public good. Of course the Republicans decided right off the bat
that Obama was illegitimate and that they would oppose everything he stood for,
so that platform never really worked. And, over time, Obama has been gradually
inching toward a more open confrontation with economism.
On July 26, he gave a much-heralded speech at Knox College
in Galesburg, IL. This was planned as his first of a series of speeches on the
economy, designed to take back the ability to frame the issue from the
Republicans. For our purposes, the question is—does he seem, yet, to get it
about economism? The answer is that there are positive glimmers but he has a
way to go.
First, the politics—Obama says in this speech that the
Number One priority of American policy ought to be to restore the prosperity of
the middle class, along with making it possible for the poor to advance and
become a part of the middle class. He accuses the Republicans who refuse to
work with him as having no alternative program except opposition to his own
policies. One of the memorable lines from the speech (there aren’t many, though
it’s far from a bad speech) goes: “Repealing Obamacare and cutting spending is
not an economic plan. It’s not.”
So where is the
positive evidence about taking on economism?
First, Obama is fairly consistent all through the speech in
addressing income inequality. He hammers away on how middle class income has
stagnated while the wealth of the very wealthy has taken off. At one point he
even connects the dots to the reason why so many Americans have lost faith in
our democracy—if we don’t change course, he warns, “Inequality will continue to
increase. Money’s power will distort our politics even more.”
Second, he says what most economists seem to be saying about
the sluggish state of the economic recovery today, even though the mainstream
media won’t report this story as the major headline it deserves to be—that the
sequester is right now one of the main reasons why the recovery has stalled out
so badly. Now, think about this. The advocates of economism say that under any
and all circumstances, cutting government spending is a recipe for economic
prosperity. On that basis alone, what has happened since the sequester, as
thousands of Federal employees have either been laid off or their income
reduced and their ability to spend in our consumer economy proportionately
diminished, is a disproof of the ideology of economism. So saying that the
sequester is directly responsible for economic bad news is a direct attack on
the economism belief system. At least in one portion of the speech, Obama is
willing to say this out loud.
Third, Obama gives a boost to increasing government spending
on infrastructure. He throws in a gag line, “We’ve got more than 100,000
bridges that are old enough to qualify for Medicare.” He asks: does it
make any sense to allow our infrastructure to fall apart, to the extent that
eventually industry will want to relocate somewhere else where the roads,
bridges, and power grid are actually reliable, when we have thousands of
construction workers out of work or underemployed,and getting them back to work
would hugely stimulate the economy as well as repair our aging
infrastructure? Such talk, of course, is fighting talk to any economism true
believer, since again it argues for a positive role for increased taxes and
increased government spending.
Now the downside. Obama says that the Republicans don’t have
a real policy alternative, since just saying no to everything Obama is not a
policy alternative. He says if they do have ideas, say what they are and he’ll
happily discuss these ideas with them. But he never says what desperately needs
to be said—that almost the entire Republican party believes in a false ideology
that has been proven both fallacious and unworkable time after time, and until
they stop believing those things, they will never see what actually needs to be
done to fix the economy. I’m sure there is a nicer and more polite way to say
this than the way I have just said it, but as Obama is credited with being the
best orator to occupy the White House in a good while, he ought to be able to
figure out how to say that.
Second, and more minor—when he ticks off what has been
working so far in producing whatever economic recovery has occurred, while
still insisting that we need to do a lot more to restore the middle class to
its rightful place, he lists almost solely private sector activities. He hints,
by omission, that the government really has no role in turning the economy
around.
So give President Obama credit for moving in the right
direction, but in my view he has to come farther to provide the true leadership
we need on this issue.
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