Democrats Face the Future

Democrats Face the Future

“Nothing in life is so exhilarating,” Winston Churchill wrote in his memoir of the Boer War, “as to be shot at without result.” Surely this accounts for the ebullience of Congressional Democra

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“Nothing in life is so exhilarating,” Winston Churchill wrote in his memoir of the Boer War, “as to be shot at without result.” Surely this accounts for the ebullience of Congressional Democrats as they greeted their impeached President for his State of the Union address on January 19.

> While the Senate trial of the President drones on, Washington’s Democrats are dreaming about 2000. The conventional wisdom is that the Republican right has handed Democrats the keys to the kingdom. With Republicans committing ritual suicide in pursuit of the President, the economy humming and the President’s support soaring, the thinking goes, Democrats could win it all in 2000: Keep the presidency, take back the House and possibly take back the Senate (thirteen of nineteen Republican senators up for re-election represent states that Clinton won in 1996). All that is required to profit from Republican disarray is unity–behind the President’s mall-tested agenda and Al Gore’s odds-on succession. Progressives are enjoined to bite their tongues, hold their fire and wait.

This analysis is grounded more in hope than history. Republicans are in disarray, but the assumptions about the context, consensus and campaign are rose-colored, to say the least. And the conservative cast of the core Clinton agenda gives progressives little choice but to challenge the direction of the party and the country. What follows is a brief unpacking of the conventional wisdom and a discussion of the political choices facing progressives.

Monica, the Sting

It is surely true that Clinton’s reactionary inquisitors have a rather kinky capacity for self-flagellation. Republicans haven’t been held in such low regard by the American people since the impeachment of Richard Nixon. Polls suggest that as many as one-fourth of core Republican voters–particularly the young, the libertarian, the more affluent–are appalled by what Gingrich called the “cannibals” of the Republican right.

Republicans bear other scars as well. They’re paying a growing political price for being the party of white male sanctuary, centered in the South. And one reason they fell for the Monica sting was the absence of anything other than scandal to sell. Clinton stole their staples: balanced budget; welfare repeal; more prisons, police and executions. Democrats are far more trusted on kitchen-table issues: schools, jobs, Social Security, minimum wage, healthcare. And the perennial Republican hole card, tax cuts, has been trumped twice: by Medicare in 1996 and Social Security in 1998. The signature programs of the Great Society and the New Deal–the largest domestic social programs–turned out to be more important to voters than the desire to get some of their money back.

But Republican turmoil has not yet translated into Democratic strength. In 1992, when Clinton gained the presidency, Democrats controlled the House 258 to 176, the Senate 57 to 43 and the nation’s governorships 30 to 18. As the new Congress convenes, Republicans control the House 223 to 211, the Senate 55 to 45 and the nation’s statehouses 31 to 17. Republicans lost House seats but won more total votes than Democrats in 1998, in an election that featured the lowest voter turnout since 1818 outside the South. However exhilarating, escaping extinction is a long way from triumph.

Context: Prosperity in a Troubled Sea

President Clinton celebrated “a new dawn for America” in his State of the Union address–and why not? The country is experiencing the longest economic expansion since the sixties. Unemployment is at its lowest peacetime rate in more than forty years. Inflation is nonexistent. The budget is generating record surpluses. Home ownership is the highest in history. And in the past two years wages have been going up across the board, with African-Americans and Hispanics experiencing the lowest unemployment rates since 1972, when figures for those categories were first recorded. Stocks are at record levels; America is the envy of the world. The strong economy buttresses Clinton against his foes and bolsters Democratic hopes for 2000.

But the confidence of the White House in public is accompanied by the stone-cold dread of Treasury Department economists in private. America trips lightly, but on a high wire, in strong winds, without much of a safety net. The world is suffering what the President calls the “worst financial crisis since the Great Depression.” Countries accounting for about a third of the world economy are in recession. Japan, the world’s second-largest economy, is still sinking. Russia’s gangster capitalism has gone belly up. Brazil, the firewall against the contagion’s spread to Latin America, is going down.

As he moved aggressively to lower interest rates last fall, Fed chairman Alan Greenspan warned that the United States would not remain immune to the global tribulations. The effects are already apparent even at the height of prosperity. The ravaged economies have no option but to try to export their way out of collapse. With Europe and Japan sustaining surpluses, the United States becomes the buyer of last resort. The trade deficit is soaring–headed toward $300 billion in 1999. We’ve been losing manufacturing jobs since last April. Corporate profits are down. Companies unable to raise prices slash costs and cut workers. Mergers worth a staggering $2.5 trillion were announced last year. According to the placement firm Challenger Gray, last year was the worst year for corporate layoffs in the nineties, with worse yet to come.

In a January speech at the Detroit Economic Club, the President argued that “nations purchase prosperity by saving and investing and being prudent.” But these days, the fate of the global economy depends to a large extent on whether US consumers keep spending recklessly.

Over the past months, US consumers, buoyed by record stock prices and low interest rates, have been spending more than they are earning. This leaves central bankers across the world terrified at what they see as a pure speculative bubble in US stocks. The establishment Financial Times “Lex” column flatly says US stocks are overpriced by about 50 percent. Greenspan’s complaints about “irrational exuberance” were issued when the Dow Jones average was nearly 3,000 points lower than it is now and corporate profits were stronger. A stock market “correction” could sober up consumers, with devastating effects around the globe.

But the political effects may not depend upon a stock market crash or a recession. What is already happening–rising trade deficits, accelerating mergers, increasing layoffs, greater insecurity for working people–will curb the growing optimism that working people have about the economy. Despite the longest period of growth since the sixties, non-college-educated working people haven’t regained ground lost over the past twenty years. More go without health insurance or are underinsured as employers force them to pick up more of the tab. Inequality is at record levels and getting worse. In the richest nation in the world, one in five children is raised in poverty.

Any Democratic strategy based on riding the wave of prosperity to victory in 2000 is surfing stormy seas. And the global turmoil calls into question the conservative core of Clinton’s economic agenda–austere budgets crafted for Wall Street and a trade policy catering to global corporations. As the effects of global deflation wash up on these shores, budget surpluses may help push the country into recession. With speculative capital flows now leveling entire nations, the question is how to control capital, not how to free it up.

Clinton–whose political survival instincts are unmatched–has scrambled in recent months to get ahead of the wave. We can’t rest on our laurels, he says. We must meet the “long-term challenges that our people face,” including making the “world economy work for…ordinary citizens throughout the world.” Clinton has begun to change his rhetoric, if not his policies. He’s warned the Japanese to lower steel exports to America to pre-crisis levels or else. He’s echoed progressive concerns about the “race to the bottom,” calling for protections for workers and the environment and for a “new global architecture” to curb destabilizing speculative capital flows. With his characteristic amalgam of bold words and small gestures, he’s scrambled to inoculate himself politically from what may come next.

Consensus or Conflict

Most Congressional Democrats will rally behind the Clinton agenda laid out in the State of the Union address. Much of it is a carry-over from 1998–Save Social Security First, a Patient Bill of Rights and a flurry of liberal domestic initiatives: an increased minimum wage, more money for education, tax credits for long-term healthcare, credits for impoverished areas, etc. With Republicans mired in Monica, Democrats stand in bold contrast by focusing on Clinton’s poll-tested, bite-sized gestures of concern.

But neither the consensus among Democrats nor the contrast with Republicans is likely to hold. The Clinton agenda is so timid that Republicans can easily co-opt much of it, and new House Speaker Dennis Hastert, despite his pristine conservative credentials, presents the very picture of earnest bipartisanship. Republicans are also for more money for education and a form of patient protection. Tax credits for long-term healthcare was in the Contract With America. Increased spending on the military is their victory. They stand ready to join the President in “saving Social Security” while passing tax cuts to keep the economy moving, hardly an unpopular proposition.

Democrats, on the other hand, are likely to find it harder to stay united. Depending on what Clinton does in the coming negotiations with Republicans, the party will face some brutal debates that simply cannot be ducked. The Progressive Caucus presented its own State of the Union message prior to the President’s. Representative Jerrold Nadler warned against any retreat toward privatization of Social Security; Jan Schakowsky applauded the President’s commitment to Medicare but expressed concern about disturbing reports on the long-term plans of his bipartisan commission on Medicare; Peter DeFazio scored the President’s pledge to pump billions more into the Pentagon. Meanwhile, Bernie Sanders and Barney Frank are leading separate challenges to the corporate trade agenda.

The fate of social insurance, domestic priorities and investment, a global New Deal–differences on these issues can’t simply be papered over, for they are fundamental to the direction of the country and the party.

The Battle for the Future

Nowhere was that more apparent than at the annual December conference of the Democratic Leadership Council, the big-money wing of the party. At each DLC convention, its president, Al From, gives New Democrats credit for all victories and blames all losses on the collective failures of “old Democrats”–liberals, unions, blacks, Jesse Jackson. (Where Clinton falls depends on how he fares. In 1992 when he won, the DLC claimed him as one of theirs. In 1994 when he was down, they kicked him for straying from the faith and muttered about breaking from the Democratic Party altogether. In 1996 he was back in their good graces again.)

This year, the DLC called upon three senators–two of them potential rivals to Gore–to give addresses on “facing the big challenges.” Bob Kerrey argued for partial privatization of Social Security; John Breaux called for privatizing Medicare; and John Kerry suggested that the rigors of market competition provide a needed tonic to the public schools. As the crisis brought on by footloose capital flows engulfs the globe, the DLC paints public institutions–Social Security, Medicare, public education–as the central problem and pro-market reforms as the solution.

This agenda fits with the DLC’s analysis of the “next politics.” Not surprisingly, From took credit for Democratic gains in 1998. Rather than highlighting the remarkable turnout of union families, the strategic mobilization of blacks and Hispanics or the continuing gender gap, From and presidential pollster Mark Penn focused on Democratic gains among affluent voters–particularly those with $75,000-$100,000 in family income. These voters are critical, From argues, because “America is becoming more affluent and the number of upper-middle-class voters is expanding.” In From’s notion, New Democrat ideas and themes appeal to the growing upper middle class, and the muscle of organized labor can be used to get out the vote of working and poor people.

This analysis obscures more than it informs. As Ruy Teixeira of the Economic Policy Institute points out, Democrats have been losing ground because of the decline of support among non-college-educated voters, particularly white males. These voters have been both dropping out of the political process, which offers them little, and turning away from Democrats. A majority of college-educated voters continues to vote Republican. Any strong Democratic majority for change depends upon re-engaging working families across lines of race and region–not the proverbial “soccer moms” but “waitress moms” and “technician dads.”

For From and Penn, however, the decline in low-income-voter participation is an opportunity. From suggests, with relief, that Democratic candidates need not cater so much to unions anymore; they can get the money and votes from more upscale precincts. Populist politics are passé. The New Democrat “third way” combines fiscal conservatism, free trade and pro-market reforms with social moderation that will allegedly captivate the rising upper middle class (or at least make fundraising a lot easier).

Anyone who cares about the vast majority of Americans can’t head down this path. The global financial crisis, the growing inequality at home and the insecurity amid prosperity mandate a renewed fight for an activist government. As AFL-CIO president John Sweeney put it, “In these conditions, corporations need more accountability, not more license. Financial markets need more oversight, not less. Workers need to be empowered, not weakened. The problem is not that governments are too strong, but that they are too weak.”

Campaign Jitters

No modern-day sitting Vice President has ever been denied the nomination of his party, so Gore is seen as a virtual lock for the nomination. Democratic insiders hope that if the economy keeps humming along, the 2000 election will be a Democratic version of 1988: Gore as George Bush, a weak candidate elected in a decent economy in the wake of a popular, if tarnished, two-term President, with the benefit of a divided opposition.

Yet even devout Clintonistas are nervous about the Gore candidacy. Gore is a better speaker than most people realize, but he exudes none of Clinton’s remarkable affinity for people. If Clinton is the caring nurse who feels your pain, Gore is the busy dentist likely to cause you pain. When Clinton proposes token gestures in healthcare or childcare, people assume that he cares. When Gore does it, they just may conclude he doesn’t have a clue about the extent of the problem. To borrow Pat Schroeder’s famous sobriquets for Reagan and Bush, if Clinton is Teflon, Democrats fear that Gore may be Velcro. He was tarnished much more than Clinton for a much smaller role in the campaign finance scandals of 1996. And the inquisition that seems to have lifted Clinton up may weigh Gore down. If Republicans nominate one of their “compassionate conservatives”–a Bush, Dole, even Quayle–the upscale independents whom the DLC celebrates may decide that 2000 is a good time to put the recent Democratic unseemliness behind them. And if the economy slows and the Democratic base grows more cynical, Gore may just have too much baggage to overcome.

No one knows how Gore will present himself. Clinton always campaigned far more populist than he governed. Gore would surely be wise to run not on the Republican-lite imitation of the DLC but on a more populist agenda that appeals to working families. Gore rouses labor audiences with a great speech on the right to organize, but his presentation to the DLC convention, billed as a test run of presidential themes, was so vacuous as to be incomprehensible. He embraced “practical idealism.” When Philadelphia Inquirer reporter Dick Polman pressed a Gore aide to explain what that could mean, he got an answer of such incoherence that his editors accused him of trying to burlesque the Vice President.

The Progressive Challenge

With the conservative era running on empty, it is time to challenge the limits of the current debate. A broad mobilization by labor, consumer and environmental groups has frustrated the corporate trade agenda–defeating fast track, sinking the Multilateral Agreement on Investment and forcing labor and environmental conditions back on the Administration’s docket. A coalition including labor, minorities, women and seniors came together to oppose any attempt to privatize Social Security and has begun to wean the President away from the notion. Progressives have led the fight against the right-wing inquisition and have consolidated the hold of liberal social values–civil rights, choice, environmental protection, greater tolerance–on mainstream opinion. Successful living-wage and campaign finance fights have been fought at the local level.

Inevitably, much of this has been defensive. One way to lay out a different direction would be a presidential primary challenge to carry the argument to millions of Americans. If this economy falters badly, 1976 may be more instructive to progressives than 1988. Two decades ago, as stagflation was discrediting the liberal era, a rising conservative movement pushed for political power. Ronald Reagan challenged a sitting Republican President, Gerald Ford, in the Republican primaries. Reagan carried the conservative agenda into the primaries–assailing détente and alleged US weakness abroad (using the Panama Canal treaty as metaphor), decrying the decline of families and values, and putting forth an agenda of growth through deregulation, tax cuts and monetarism.

Reagan almost beat Ford, who then lost the general election. Democrats controlled everything–White House, Senate and House–but conservatives won big. In two years, Carter was enacting much of the Reagan agenda: monetarism, a cold war revival, increases in military spending, the dismantling of corporate regulation. In four years, Reagan was in the White House, Republicans took the Senate and a dispirited Democratic House deferred to the new President’s conservative program.

In 1976 conservatives were sufficiently convinced of the power of their cause that they were willing to challenge a sitting President of their own party and risk letting Democrats win everything. Are today’s progressives prepared to take a similar risk in 2000–challenge the agenda and the candidacy of a sitting Vice President of their own party, even at the risk of losing the White House and the Congress to Republicans? With Senator Paul Wellstone out of the race and Representative Dick Gephardt unlikely to get into it, the question may be moot, unless Jesse Jackson decides to run. But whatever Jackson decides, the leaders of much of the activist base of the party–unions, women’s groups, civil rights and minority groupings, environmentalists–have already indicated their aversion to a divisive battle in the primaries.

Even if progressive leaders are reluctant to oppose a Gore candidacy they have no choice but to mount a clear and aggressive challenge to the limits of the Administration and Gore agenda. “We saved the President,” says Representative Barney Frank, “not Joe Lieberman. People across the country know that. Now we need to lay out where we stand. The White House may be more responsive than people think. If not, let’s have the fight out in the open. We can come together later against the right.” That may not be much, but it makes a whole lot more sense than the conventional wisdom.

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