Democrats Make a Down Payment on a Radically More Just Economy

Democrats Make a Down Payment on a Radically More Just Economy

Democrats Make a Down Payment on a Radically More Just Economy

The American Rescue Plan goes beyond Covid relief to address the deep inequities the pandemic revealed. Will those changes be a Band-Aid, or heal a broken system?


Biden’s Welfare Flip Flop.” That’s how Politico framed President Biden’s $1.9 trillion down payment on a new federal government approach to supporting its citizens’ economic security. Everything about the headline was wrong.

“Flip-flop” is one of the most overused and incorrect terms in political journalism; it either trivializes crass hypocrisy or misrepresents a genuine political change of heart. “Welfare” is grossly inadequate to describe what the American Relief Plan provides. And “Biden,” well, he’s Joe Biden, for sure, but the many forces behind this stunning achievement are beyond my capacity to list here—and they represent a leftward migration of the Democratic Party that was a long time in the making but that accelerated in the past 10 years. Biden has been in the middle of it.

The middle of it. Not leading it, certainly. But not trailing either.

An assortment of other outlets are calling the bill a vast expansion of the welfare state. There’s nothing inherently wrong with the term “welfare.” But decades of race-coded GOP attacks, most indelibly Ronald Reagan’s Cadillac-driving “welfare queens,” made it toxic. That helped lead to Bill Clinton’s 1992 promise to “end welfare as we know it,” culminating in the hugely flawed but widely supported 1996 welfare reform bill. It was meant to cure the vice of “dependency” on government, even though the most dependent on that program happened to be children.

One genuine problem with welfare, as we knew it, was that it was a tiny amount of money for the poor, divorced from any kind of social infrastructure designed to help them rise—or to help struggling working and middle-class people rise as well. The ladders of opportunity constructed to elevate a middle class after the Great Depression and World War II—labor rights, mortgage guarantees, vastly expanded public spending, new public universities—had been chopped off by corporate elites from the top, starting in the late 1970s. Given all that, “welfare”—stigmatized by corporate propagandists, resented by much of the working class—had to go too, according to the bipartisan consensus of the times.

Biden was there for the demonization of welfare and of government, in the last three decades of the 20th century. Politically, he grew up with those ideas. He even helped spread them. Elected to the Senate as a liberal-seeming centrist with sideburns the same year as Richard Nixon’s reelection, by the time Biden ran for president the first time, in 1988, he was proclaiming that “government subsidy is not the ultimate answer to the problems of the poor” and citing Reagan’s “stories of welfare mothers driving luxury cars” (h/t Politico). The senior Delaware senator helped pass Clinton’s 1996 bill.

But Biden has grown past those views. That’s been evident at least going back to his tenure as President Obama’s VP. So has pretty much the entire Democratic Party. It’s not a social democratic party, at least not yet. But it has steadily gotten more committed to using government to lessen suffering and promote equitable growth, and less afraid of GOP taunting about deficits and “dependency.” It had mostly moved past the neoliberal fetishization of markets, long before the pandemic: Hillary Clinton’s 2016 platform was more progressive than Obama’s, with a more robust role for government; four years later, Biden’s was more progressive than Clinton’s. (That partly reflected the influence of Senator Bernie Sanders, who ran a strong second in the Democratic presidential primaries to both of them.)

The pandemic accelerated the leftward surge of many, even most Democrats. The mismanaged plague that has in a year killed 530,000 Americans also destroyed Reagan’s tired maxim, “Government is not the solution to our problem, government is the problem”—hopefully for good. Last year’s first Covid relief bill, the $2.2 trillion America Cares Act—passed under the uncaring, incompetent Donald Trump—kept 13 million people out of poverty; when its benefits began to evaporate, especially its extended unemployment relief, people felt the difference, and the pain. That’s why Biden’s plan is supported by roughly three-quarters of Americans in the latest Morning Consult/Politico poll: Americans know government is the solution, at the very least to this deadly pandemic.

And they know this bill goes way beyond “welfare.”

Of course, the other pre-pandemic relief effort that influenced the Democrats’ shift on spending, and the commitment to an aggressive role for government to ameliorate suffering and promote equity, was the 2009 American Recovery Act. Everyone now knows—many people knew at the time—that it was too small to lift the economy out of the crater blown by the financial industry and real estate crash. But Obama pledged to keep it under a trillion dollars, though some of his advisers argued that was inadequate, in order to win over some Republicans. In the Senate, he got three. And indeed, the recovery was slow, uneven and unequal. Not just Biden but a cadre of Democratic leaders learned their lesson.

“What happened in 2009 and ’10 is we tried to work with the Republicans, the package ended up being much too small, and the recession lasted for five years,” Senate majority leader Chuck Schumer said after Senate Democrats passed the ARP 50-49. “People got sour; we lost the election.” Schumer, House Speaker Nancy Pelosi, and Biden, backed by an increasingly powerful progressive flank, showed this week that they won’t let that happen again.

What’s most important about the Biden plan is not its size but the thinking behind it. For one thing, it rejected old notions about government support as a morally hazardous “handout” to the undeserving that would discourage work. Welfare reform essentially punished poor children for the (supposed) wrongdoing of their parents (mostly single mothers) and, especially, their joblessness.

By contrast, the expanded child tax credits are more like Social Security, a recognition that government has a role to play in caring for those who can’t care for themselves, not just the elderly but children as well. It isn’t conditioned on whether parents, especially mothers, work or stay home, which was formerly a culture-wars obsession. Likewise, expanded unemployment insurance passed (though it was trimmed slightly), despite arguments that it could make not working more alluring than working. Most wealthy developed nations offer support like this.

In terms of Covid relief, Democrats were, uncharacteristically, more afraid of going too small than too big—those $1,400 checks go to single folks making as much as $75,000 and couples up to $150,000. Some near the top may not be struggling; some may be, but it was nice to see only minor trimming. Democrats seemed to realize that the more people helped by the legislation, the more sustainable it is.

The bill supports small businesses and restaurants, child care providers and union members on the verge of losing their pensions. It invests billions in Black farmers and Native Americans, funding that’s long overdue but especially needed in this pandemic. It also pumps billions into state and local government: That’s another learning from early Obama efforts to stem the bleeding in 2009: As the federal government sent money into the economy, budget-crunched local and state officials were laying off workers and thus taking money out of it.

It significantly shores up the Affordable Care Act, weakened by Trump, including more subsidies for more people, and not just the poor. But back to the poor: It reduces child poverty by more than half; poverty for all Americans, according to the Urban Institute, by almost 40 percent.

We haven’t arrived at the universal social support programs enjoyed by most wealthy developed countries, which endure because they lift (almost) everyone who needs a lift. But for a year at least, we’re getting close.

Yes, these programs will expire. They were built to be temporary, to meet the acute Covid crisis and also to avoid tripwires, set back in the bad old days, that forced programs that raised the deficit beyond a 10-year window to find tax hikes or spending cuts to pay for themselves. A year from now, perhaps months for some programs, Congress will face a reckoning: Extend these programs, for years or indefinitely, or yank this support out from under millions of Americans. Democrats, especially progressives, are betting that few colleagues will be heartless enough—or rash enough, facing the 2022 midterms—to do that. We’ll see.

It’s not a perfect analogy, but when the George W. Bush tax cuts were set to expire in 2011, there was a bipartisan deal to extend most of them, except for American households with incomes over $400,000. Its architect was Vice President Joe Biden. He knows how to extend a bill that’s supposed to sunset, if you have the right arguments.

Biden and the Democratic leadership—and like it or not, most are still there from the Obama years—learned a lot from the way our first Black president was treated. Obama committed to bipartisanship, from his campaign through his first term, even after he was greeted by the purportedly anti-government, mostly racist insurgency termed the Tea Party. Not just the 2009 stimulus but the ACA bear the scars of Obama’s commitment to win Republican support. On the latter bill, he utterly failed, but Democrats nonetheless accepted hundreds of GOP amendments that weakened his signature accomplishment, without winning a single GOP vote.

Politically, at least, his second term was better; Obama lost his illusions. It was too late for more historic legislation, but he made his priorities and his insights plain.

Biden absorbed them. I’m not gonna lie: He made me anxious during the primaries, and even through the general election, with his promises to find Republicans he could work with. Even after the election, on the day the Electoral College certified his win, he said he was “convinced we can work together for the good of the nation.” I was not.

In late January, I did not enjoy Biden’s warm welcome of alleged Republican “compromisers”—the 10 or so senators who made a Covid counteroffer, one that spent less than half of Biden’s plan and pointedly refused any aid to the state and local governments on the front lines of fighting the pandemic. The new president welcomed his former Senate colleagues to the Oval Office for two hours. They all went out and said nice things—Maine’s Susan Collins called the meeting “very productive and cordial.” The president said nice things too, according to the White House, but “reiterated his view that Congress must respond boldly and urgently, and noted many areas which the Republican senators’ proposal does not address.”

It turned out that wasn’t just a one-day riposte. That’s where Biden landed, with the Democratic leadership’s support. Even as the Senate prepared to entertain compromise proposals from Republicans, it laid the ground for the stark realism of “reconciliation”—moving a bill that has largely budgetary implications with only 50 votes, as Senate rules allow. Bipartisan debate went on, as did reconciliation prep; ultimately, the ARP passed 50-49.

Then it went back to the House, and here I want to hail the members of the Progressive Caucus. They had major problems with the Senate bill—it stripped the House version of the $15-an-hour minimum wage, reduced unemployment benefits slightly, and (even as single mom and progressive powerhouse Katie Porter railed against it) left inequity between single parents and married parents intact—but they kept their eyes on the prize. Most people, myself included, assumed Biden and the Democrats went into this negotiation with a $1.9 trillion plan in order to cut it by at least a quarter. They did not. Progressives knew what this bill achieved.

Progressive Caucus whip Representative Ro Khanna hit the cable shows almost immediately after the Senate bill passed, promoting it. Bernie Sanders praised it too, tweeting after its passage on Wednesday: “What a difference it makes when government is on the side of working people.” An elated Representative Pramila Jayapal, Progressive Caucus chair, told CNN’s Anderson Cooper that Republicans made “a very big tactical mistake” in providing zero support for the relief package. “They’re going to have to try to explain why they voted ‘no’ on a package that puts money in people’s pockets.” On Wednesday afternoon, at a signing ceremony for the bill convened with Pelosi, Schumer effusively thanked Sanders. As well he should have.

This is the new Democratic governing coalition moving forward—with a strong left wing that knows when to choose its battles, behind a president who survived the era when government was a dirty word, and now gets to live up to the ideals that inspired him to enter government. Every day won’t be like this, but as Biden signs the American Rescue Plan Act, less than two months into his presidency, I think we should all celebrate. This is a big fucking deal.

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