Friday, February 27, 2009

The Main Obstacle

Cowardice and “bipartisanship” are obstacles in the way of the “change” many Obama voters, the ones not just voting against McCain, thought they voted for. But the main obstacle is something else: it’s the way we finance electoral campaigns. If only we could reduce private contributions to insignificant amounts and rely on public funding instead, real change can follow.

Ever since the Supreme Court ruled in Buckley v. Valeo (1976) that only minimal, easily circumvented, restrictions on campaign contributions are permissible, the quasi-official view has been that no matter how much money talks, restricting campaign contributions restricts free expression in violation of the First Amendment. This is not the place to address the few merits and many shortcomings of this way of thinking. The Supremes were wrong, but untangling and then addressing the questions involved is complicated. However there is nothing complicated about the observation that the system now in place impoverishes political debate. It leads to the marginalization of positions that are, in many cases and by almost any standard, sounder than those that it legitimates, and it even makes it possible to ignore plain facts.

Notwithstanding how the “mavericks” McCain and Palin made an issue of “earmarks” and “pork” in the 2008 presidential race, a theme Obama seems to have adopted, the problem has less to do with what monied interests purchase when they “pay to play” than with what they are able to remove from political debate altogether. Three timely examples will explain what I have in mind:

-first, the virtual exclusion from discussions of the Iran Question of the indisputable though seldom acknowledged fact that Israel has many more nuclear weapons than the Mullahs could ever dream of. In view of Israel’s proven eagerness to go to war, its insistence that Iran poses an “existential threat,” and the likelihood that the next Israeli government, led by Benjamin Netanyahu, will be even more bellicose than the current one, this stubborn fact is plainly relevant to assessing Iran’s position on developing nuclear weapons and to reflecting on what an appropriate “response” to Iranian ambitions might be. Nevertheless, the combined weight of the Israel lobby and the various “defense” lobbies has effectively removed this very relevant fact from public discourse.

-or consider health care. Plainly, it would be better to get private insurers out of the system altogether; all they do, after all, is skim off huge amounts of money while generating inefficiencies in the process. But they’ve bought their way into the system to such an extent that “single payer” – government run -- health insurance remains off the agenda now as much as it was a generation ago when Hillary Clinton botched up efforts to secure universal coverage. That we’d be better off without private insurers involved in the health care delivery system is, at once, perfectly obvious and utterly beyond the pale. We have our system of private campaign financing to thank for that unfortunate result.

-then there is the financial crisis; the need, acknowledged by almost everyone, to get credit flowing again. Could anything be more obvious than that insolvent financial institutions, big and small, should be nationalized; that their managements should be replaced and that their stockholders, not taxpayers, should take the hit? If nothing else, it’s a matter of simple fairness. The “financiers” made off like bandits by gaming the system. Now that the sky has fallen, they should be the ones it falls on hardest. But it also makes economic sense because there is no quicker and surer way to make loans available again, and because so long as credit is frozen, the efficacy of the Obama stimulus package is diminished. So far, though, the Obama administration seems interested only in saving the bankers (i.e. the gamblers) and their banks – by indemnifying them for their losses with yet more taxpayer money. In time, it may become clear, even to the Wall Street operatives Obama appointed for his economic team, that saving bankers is not the way to save the banking system. But given how “generous” Wall Street has been to both Democrats and Republicans, it is far from clear what the effect on policy of this realization will be.

Needless to say, full public financing would not make everything better automatically. It would not alter the stifling structural constraints that a capitalist economic system imposes. All liberal democracies, including those with saner, more democratic electoral systems, confront these obstacles. But, so long as we are doomed to operate within that framework, full public financing would remove the main obstacle in the way of what Obama voters were hoping his election would bring.

Ironically, public financing is perhaps the one feasible, major reform around which “bipartisan” support should be forthcoming. Republicans may be second to none in baseness and servility, but even they must hate groveling before their corporate paymasters. In this instance, inertia, not ideology, is the problem – that and, of course, the Supreme Court.

But where there’s a will, there’s a way. The problem is that there isn’t much will. Electoral reform is one of those issues that comes up at election time and is then forgotten as more pressing concerns arise. It is happening again. But if it is permitted to happen, “change we can believe in” will never get beyond the “aspirational” stage.

Monday, February 23, 2009

Sticking It To CEOs

With much fanfare and popular support, Mississippi Senator Claire McCaskill called a few weeks ago for a $400K salary cap for executives in firms getting public bailout money. $400K is the salary of the President of the United States, though of course, presidents get perks that even the titans of corporate America can only dream of. The “populist” clamor for sticking it to CEOs got to be so intense that even President Obama, the Forgiver-in-Chief who only wants to “look forward,” felt obliged to weigh in. He supported the idea, kicked in another hundred grand, and then implemented the proposal in his stimulus package in a way that will affect almost no one. Still, it’s the “symbolism” that counts. Overnight, top executives have been transformed from heroes into villains.

Needless to say, they deserve all the contempt we can muster and, in most imaginable circumstances, it makes sense to villainize them. But this latest “populist” eruption, for all its merits, can be profoundly misleading. It also reveals how mindless and ahistorical what passes for a “left” in our country has become.

It can be misleading because it puts the blame for economic turbulence on “malefactors of great wealth” instead of on the system they exploit for their own advantage. Had the Bush Treasury Department and the Federal Reserve (with Timothy Geitner leading the way) not let Lehman Brothers collapse, the current spate of crises in the financial sector would doubtless have unfolded at a different pace and perhaps with less severity. But the incompetence of the Bush administration and the Fed is not the reason why credit is now virtually frozen. The problems are structural -- and were therefore bound to have their due, one way or another. Similarly, had Wall Street and its overseas counterparts been a tad less greedy, the misfortunes engulfing the world economy now might have been mitigated somewhat. But, in the final analysis, the crises we face did not result from the misdeeds of bad individuals. Again, the problems are systemic – a point that largely eludes acknowledgement among those whose sympathies lie with “the wretched of the earth.”

This is why calls to stick it to CEOs are largely beside the point., the popular base of “left Obamaism” congratulates itself for the largely symbolic pay caps in the stimulus bill. So do others who have stuck their own two cents into the fray. These contentions are not without merit. They show how Obama can be pushed into taking a more progressive direction than his Wall Street friendly advisors might like. But they also show how intellectually bankrupt those who rally behind “populist” causes have become.

For one thing, it’s not clear what our new populists think the problem with exorbitant CEO salaries is: is it that they’re inefficient?, that they represent a kind of profiteering (but of whose wealth? the stockholders?), or is the problem that top executives’ salaries offend egalitarian principles so egregiously that even liberals must take notice? Perhaps it’s some inchoate mixture of all of the above or something else altogether. But, at an intuitive level, it is plainly the offense to equality that is doing the work. Presumably, no one on the “left” gets exercised about shareholders being taken advantage of or about how corporations might be made meaner and leaner.

If the problem is indeed inequality, it’s not that there aren’t ample bodies of theory available to enlighten the discussion. For more than a quarter century, equality has been Topic A in academic social and political philosophy and in cognate fields. Inevitably,all this attention has yielded advances in understanding. However, as is often the case in our political culture, these advances have not made their way into either mainstream or dissident thinking. For those outside narrow academic precincts who know about them at all, their interest is strictly “academic.” The result is that proponents of the new populism are blissfully ignorant of work that could make their efforts more coherent. Thus their opposition to exorbitant CEO compensation is only intuitive, not principled. It is of a piece with the reflexive goody-goodyism that has become emblematic of “progressive” politics today.

This is why the “pay cap populists” endorse positions that thoughtful egalitarians can only find bizarre. What they favor is not equality, on any plausible construal of what that notion involves, but generous limits on inequality – for those who work in corporations and financial institutions. [If they have opinions about athletes or actors or pop stars or, for that matter, investors, they keep them to themselves.] Specifically, they favor 1950s levels of inequality – levels that were, needless to say, thoroughly inegalitarian, though better than what we have today. In effect, they are not so much fired by egalitarian sentiments as by nostalgia for the Eisenhower era.

On matters of fiscal policy, Bill Clinton was an Eisenhower Republican too – albeit a timid one. Ike launched the inter-state highway system; Clinton let highways and bridges deteriorate. But it is one thing to adapt Eisenhower policies to current conditions, and something else to turn those policies into a vision of ideal arrangements. That’s the point we’ve now reached. Of course, the 50s were followed by the 60s, the era of “the imagination in power.” If we’re doomed to cycle between those poles, and if we don’t want to succumb entirely to the situation we now face, we’ve got to get to work quickly to get on to the next phase. To that end, it’s far from clear that that pay cap populism is something to encourage.

I’ve already suggested that vilifying outrageous salary levels draws attention away from the structural features of the economic system that make these outrages possible. The problem, though, is that the idea that there are alternatives to the system in place has fallen into desuetude. Today’s “populists” don’t favor alternatives to capitalism; they only favor saccharine ameliorations of some of capitalism’s deplorable consequences. For them, this is not even a principled choice; the idea that there are fundamentally different ways of organizing modern economies is a relic of a bygone era to which, if they think about it all, they bid good riddance.

Indeed, it is only for those of us “of a certain age” and perhaps also for the generation too young to have been warped by the Reagan-Clinton-Bush Family consensus -- for those of us for whom “red” means something other than “Republican” -- that the current crisis in global capitalism does not betoken a crisis of capitalism itself. Europeans and others, with richer socialist traditions to fall back upon (even as they have fallen farther away from them in recent decades) are not quite so disabled. In any case, the time is long past due for anti-systemic resistance.

Caps on executive compensation can be accommodated within Obama’s “pragmatic” framework. Perhaps they can even gain a measure of “bipartisan” support – especially if they are more symbolic than real. This is not something to be despised. But neither is it anything wholeheartedly to praise. The time is upon us already where it has become urgent to transcend the horizons of the Obama framework. To that end, congratulating ourselves over pay caps in the stimulus bill can be more of a hindrance than a help.

Monday, February 9, 2009

Moderate Muddle Heads

If there is any greater obstacle than reempowred Clintonites to “change we can believe in,” it is “bipartisanship.” That’s what enabled the free market theologians of the Republican Party to frame the debate on Obama’s woefully inadequate but urgently needed “stimulus package.” They will not have their way, but they have already done grave harm. With Obama’s help, they’ve put the muddle heads in the “middle” in charge.

The free marketeers’ views are ludicrous, of course. But at least they are guided by a principle, and they have the virtue of consistency. It is hard not to admire those benighted legislators, if only for their obstinacy. Had “progressive” Democrats been similarly uncompromising, they might have prevented some of the most egregious of Bush’s and Cheney’s crimes. But, of course, that is not the Democrats’ way.

Do the Republicans in the House and Senate believe their own drivel? To the extent they do, who can blame them? It’s not just watching Fox News or listening to Rush Limbaugh or having a crush on Sarah Palin that moronizes those who are already predisposed to be stupid. Throughout the entire Reagan-Clinton-Bush family era, free market theology has been in the air we breathe. It has become an article of faith for many Republican voters. Even the Clintonite-Wall Street crowd Obama restored to power was on board with similar views – until quite recently, when reality struck.

Thanks to the Republicans’ obstinacy and Obama’s “bipartisan” flexibility, it now seems that the “moderates” will get to call the shots. Thanks to them – thanks specifically to three Republican Senators, Pennsylvania windbag Arlen Specter and two Maineacs, Olympia Snow and Susan Collins – the Senate will finally pass something. What they will pass lacks the virtue of consistency or fidelity to principle. In fact, it’s plain stupid. It cuts the size of the stimulus, at a time when it should be increased; and its cuts are targeted to be maximally counter-productive. It reduces aid to states, increasing unemployment and diminishing services, and it provides tax credits for homebuyers in a way that will likely reinvigorate real estate speculation. This is where bipartisanship leads. The result is so bad that now even liberals who had been inclined to give Obama every benefit of the doubt are expressing outrage -- witness Paul Krugman’s column, this morning, in The New York Times.

Maybe it’s not too late for Obama’s bipartisan nonsense to stop. Maybe he will use his Elkhart, Indiana town meeting today or his prime time news conference tonight to change course. Obama must realize by now that a change is long past due. Even Larry Summers was up in arms yesterday, on George Stephanopoulos’ Sunday talk show, about the cut in funding for the states! On the other hand, maybe Obama is still too much in campaign mode not to continue making nice to Republican snakes in the grass in order to win the favor of the morons in the middle – not just the “undecided” voters who got his undivided attention before November 4, but now their legislative counterparts, the ones on both sides of “the aisle” whom the media deem “moderate.”

The next few days will tell.

Friday, February 6, 2009

Republicans to the Rescue

Yet again. Democrats keep making the least of opportunities presented to them, but the Republicans keep them coming. There are signs, though, that even the Party of Pusillanimity has reached its limit, and that the “bipartisan” crap will soon end (at least for awhile). As Senator Charles (Schmucky Chucky) Schumer put it, “it takes two to tango, and the Republicans aren’t dancing.” If enough Democrats take his words to heart, maybe their flawed but indispensable stimulus package will finally happen.

Then the problem will just be that, in the face of an impending economic catastrophe, the Wall Street malefactors who brought it on -- or, rather, their “left” (Clintonite) wing – will be in charge of programs that don’t go nearly far enough and that hover too much around the old, failed ways. But that’s better (less bad) than a Republican concoction of barely warmed-over free market theology. After all, for voters who thought that with Obama they’d be getting “change” they could believe in, half a loaf – or, is it a third or only a quarter? – is better than continuing victimization by high-flying predators.

Tuesday, February 3, 2009

Daschle Out

Judd Gregg was probably going to lose his Senate seat in 2010 anyway, so why not serve the ruling class better as Commerce Secretary? On the other hand, Tom Daschle always had the option of going back to feathering his own nest – which he decided to do once his tax shenanigans got to be a “distraction.” Like Judd, he won’t have to change masters. And he can also do good by going back to doing well – good, that is, for the insurance industry, Big Pharma and for the barons of corporate medicine. Still, Dashcle was one of Obama’s better (less bad) appointments. However I can’t say I’m disappointed. Obama probably isn’t disappointed either. After all, now he has yet another chance to appoint a Republican.

Worse and Worser

Fortunately, Obama is running out of appointments. If he had many more to make, he might just disappear into the muck. Joe Biden was bad enough; then came the Clintonites, including the Better Half of that dreadful eponymous couple, then the Bush carryover Robert Gates, the Wall Street crowd Robert Rubin tutored – and, yes, a few beacons of “change,” but no genuine “progressives,” in peripheral positions. Now that making nice to Hillary has morphed into “bipartisanship,” Obama’s stick-it-to his-constituency style, lauded by the media for its “serenity,” has reached a new low. Judd Gregg, New Hampshire’s unabashedly rightwing Republican Senator, will be Obama’s Commerce Secretary. Gregg is not too rabid a social conservative – after all, his constituents are (comparatively) enlightened New Englanders – but on everything else, everything traditionally political, he’s as bad as all but the most ludicrous of the Republican Senators.

When rumors of a Gregg appointment surfaced last week, the thought was that Obama was being consummately shrewd. New Hampshire has a Democratic governor, John Lynch. Once Norm Coleman has exhausted all his legal machinations to keep comedian Al Franken out of the Senate, then the governor would appoint a Democrat – and voilĂ , a filibuster proof majority. But Mr. Bipartisan ain’t mean (Republican) enough. Evidently, he brokered a deal where, Democratic governor or not, a Republican would succeed the Republican. Maybe it will be a better Republican than Gregg – University of New Hampshire President Bonnie Newman has been mentioned and maybe she’d be less bad (who knows?) -- but a Republican nevertheless. The Obama-can-do-no-wrong crowd – yes, it still exists – claims, reading off of Rahm Emanuel’s talking points, that this is like stealing the other team’s quarterback. Yea, sure. It’s more like giving the other team the ball. But, then, what’s new!