New York City Democratic Mayoral hopeful Bill De Blasio celebrates on stage with his son Dante, far left, daughter Chiara, wife Chirlane, to supporters at his election headquarters after polls closed in the city's primary election Wednesday, Sept. 11, 2013, in New York. (AP Photo/Kathy Willens)
Amid the clamor over the budget and syria, the Democratic Party has opened what will be a prolonged debate about its future after Obama. Progressive concerns about foreign intervention, the “war on terror” and the cascading NSA scandals continue to build, but at the center of this debate will be economic policy: What can be done to make the party work for working people again? Or, more simply, whose side are Democrats on? In the opening rounds of the debate, we are witnessing the resurgence of what Paul Wellstone dubbed the democratic wing of the Democratic Party, challenging Wall Street’s hold over economic policy. The recent torpedoing of Larry Summers’s candidacy to head the Federal Reserve and the victory of Bill de Blasio in New York City’s Democratic mayoral primary are just two expressions of this emergence.
Summers was rejected largely because Democratic senators held him accountable for championing the ruinous deregulation of Wall Street under Bill Clinton and the bailing out of the banks under Obama. Summers personified Washington’s revolving-door corruption, as he pocketed millions on leaving government for the Wall Street firms he had aided while in office. His withdrawal was a repudiation of Rubinomics, the Wall Street economics named for Robert Rubin, former co-chair of Goldman Sachs and Clinton treasury secretary, whose acolytes have dominated Democratic economic policy for two decades.
De Blasio’s victory is an early indication of the electoral clout of progressive insurgents. He came from the back of the pack to victory by indicting Michael Bloomberg’s Gilded Age inequality, calling for raising taxes on the wealthy to invest in universal pre-K and for requiring developers to build low-income housing.
The Occupy World
Tea party republicans capture the headlines with manufactured budget crises, while Occupy Wall Street has seemingly vanished—but we live in an Occupy world. Occupy protested an economy that works for the 1 percent, not the rest of us. It said this wasn’t natural or inevitable, that it came about because the 1 percent, as Senator Elizabeth Warren put it, “rig the rules.”
Occupy got the world right. Workers have been losing ground for decades: a typical household earns less than it did a quarter-century ago. In the three years coming out of the recession, the top 5 percent are the only group to have recovered all their pre-collapse income, with the top 1 percent pocketing 95 percent of income growth; the rest have yet to experience the recovery. Although Occupy scorned electoral politics, its framework informed Obama’s re-election message, as Obama painted himself as the champion of the middle class and Romney as personifying the 1 percent (aided, of course, by Romney himself).
In a recent Daily Beast essay, Peter Beinart details how the millennial generation, struggling to find footing in the worst economy since the Great Depression, has been formed politically by this. The millennials are looking for more government, not less. They want Obamacare expanded, not repealed. Burdened with college debt, they favor more public investment, more loan relief and curbs on the banks. They were central to Obama’s election and re-election—but they are moving beyond his politics of caution.