Born-Again Rubinomics | The Nation


Born-Again Rubinomics

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Despite my skepticism about his policy ideas, I think Rubin is providing a significant opening for the opposition--a new chance for labor-liberal reformers to make themselves heard with a more fundamental critique of globalization. Up to now, the standard trade debate has been utterly simple-minded--"free trade good, no trade bad"--and anyone who opposes trade agreements or WTO rules is dismissed as a backward "protectionist." The enlightened position, as major media always explain, is to support the "win-win" promise of globalization.

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William Greider
William Greider
William Greider, a prominent political journalist and author, has been a reporter for more than 35 years for newspapers...

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Only Rubin is departing a bit from that script, effectively accepting the opposition's central complaint that "win-win" is a cruel distortion of what's happening. If so many Americans are actually losing ground, Rubin asks, shouldn't government do something about that? Yes, certainly, but that admission invites a different question: Are his establishment proposals actually likely to improve the American condition, or does the wage deterioration require more aggressive reforms?

Ideas do matter. My hope for more complex and honest debate may sound too wishful, but I was struck in our lengthy interview by Rubin's willingness to discuss contrary propositions, and by his disarmingly self-effacing and reflective manner (the transcript is posted at www.thenation.com). Several times, I was taken aback when his comments made tentative concessions to the opposition's argument. He even endorsed, though only in broad principle, some objectives for reforming global trade that his critics have long advocated.

I suggest that reformers test his sincerity. In the same spirit, they might try to initiate a conversation about what Rubin calls the "conceptual framework" for reform. He says he would welcome the discussion.

The Hamilton Project's early policy output, I concede, doesn't encourage a belief that reasoned dialogue with dissenters is what Rubin has in mind. Advisory board members see themselves as progressive-minded, but they do not stray from the mainstream's conventional wisdom--lots of Harvard, Princeton and Berkeley, no one from the ranks of "free trade" skeptics. The twenty-five-member board includes thirteen investment bankers, venture capitalists and hedge-fund managers from Wall Street and the West Coast--guys who, like Rubin, do the investment deals at home and abroad.

There's already a warm political glow. At the Hamilton launch in April, Senator Barack Obama hailed the group as "some of the most innovative, thoughtful policy-makers...the sort of breath of fresh air that I think this town needs." Senator Hillary Clinton's recent economic speeches are, not surprisingly, a good fit with Rubin's thinking, since the pair's political closeness is well-known. Washington's Clintonistas-in-waiting embrace and amplify Rubin's ideas. He helps them arrange financing for new projects, like John Podesta's Center for American Progress. Democratic candidates seeking Wall Street campaign money hope for Rubin's blessing, a seal of approval that can open checkbooks.

The "soft" ideas in the Hamilton Project playbook are mostly old ideas--improve education and retraining, provide "wage insurance" payments to dislocated workers, increase public investment in industrial development and infrastructure. All are worthy things to do, but they seem like tinkering around the edges. Ron Blackwell, chief economist of the AFL-CIO, observes, "What they've got going are these little ideas that sound like they are forward-looking and respond to the problem of living standards, but they don't speak to power."

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