In the 1970s, a new kind of Democrat began to appear on the scene. For a while, they went by different names. At first, they were the “Watergate Babies,” a misnomer because their primary opponent was not the Republican Party of Nixon, but their own. Then, as the 1980s came into view, they became the “Atari Democrats.” Young and elite-educated, they promised to make the postindustrial economy grow by encouraging entrepreneurship, investing in the burgeoning tech sector, and giving the market freer rein. Writing in 1982, Charles Peters of the Washington Monthly called them “neoliberals.” In 1984, when they decided to form an organization, the Democratic Leadership Council (DLC)—following the brief, meteoric rise of one of their own, Colorado Senator Gary Hart, in that year’s Democratic presidential primary—they embraced the label “New Democrats.” They aimed at nothing short of remaking the Democratic Party as it had been constituted for the previous half century: to reorient its electoral base away from organized labor and the Black working class, and toward affluent knowledge workers and white suburbanites; to make “leaner” a welfare state they believed had grown fat and to refashion the role of government in accordance with the logic of the market.
With the nomination and subsequent election of Bill Clinton in 1992, the New Democrats took control of the party, then the White House. Their ascendance to power, and what they did once they obtained it, is the subject of Lily Geismer’s new book, Left Behind: The Democrats’ Failed Attempt to Solve Inequality. A professor of history at Claremont McKenna College, Geismer tracks Clinton and the DLC’s enthusiastic efforts to apply market-based thinking to the intractable structural problems of US political economy. While the Reagan era had been marked by the demonization of the poor and the figure of the “welfare queen,” under Clinton marginalized people were refigured as potential entrepreneurs and savers. But those who failed to “play by the rules,” as Clinton liked to say, would still be stigmatized and punished. In 1994, Clinton signed the punitive crime bill, sponsored by Joseph R. Biden, that helped give rise to mass incarceration. In 1996, Clinton executed his promise “to end welfare as we know it.”
Clinton and the DLC, Geismer argues, sincerely believed that market-based micro-solutions—like community development banks, microenterprises, empowerment zones, and charter schools—could address macroeconomic problems. They were not cynical, at least not at first, nor were their proposals mere “triangulation” (that coinage, by pollster Dick Morris, became Clinton’s modus operandi as part of his campaign for a second term). Rather, Geismer shows, it was Clinton’s relentless optimism—a product of the 1990s economic boom—that blinded him and the officials in his administration to the inadequacy of their constructive initiatives and the destructiveness of their reforms. Nevertheless, this optimism was contagious. It shaped a new sensibility that ignored any contradiction between the accumulation of exorbitant wealth and the desire “to do good”; it furnished our culture with a new vocabulary of entrepreneurialism, the hucksterism of Silicon Valley, which remains with us today. Combined with the hard limits of political possibility, Geismer says, this conviction that a strong economy would, in the end, sort things out, accounts at least in part for why progressives’ protests of Clinton and the DLC’s program never congealed into a unified coalition that could mount sustained opposition. By the end of the 1990s, even those who had been among Clintonism’s most ardent opponents, like the Rev. Jesse Jackson, joined in celebrating Wall Street and Silicon Valley as partners in a market-based social policy.
I spoke with Lily Geismer about her new book, the electoral and ideological sides of Clintonism, and how the debates of the 1990s seem to live on, three decades later. This interview has been edited for length and clarity.
They’re also deeply worried about the size of government and government inefficiency, which they believe can be addressed through market-oriented thinking. This is critical: One of the things I wanted to do in the book was to think about neoliberalism in a different way, to show that the neoliberalism of the DLC is different from that of Milton Friedman and the Chicago school variant. The DLC approach to market-based reform is that it’s going to make government work better, and that it’s going to help bring people out of poverty. The DLC isn’t just celebrating the greatness of the market, which you see on the right. They are focused on making the market work better, and as a corollary, making government more efficient.
JL: The Clinton administration proposed a whole bevy of small, market-based reforms as solutions to rural and urban poverty, and racial inequality. Did Bill Clinton and those around him really believe that these proposals were adequate to solve problems of that scale—it’s almost hard to believe—or were they a strategic smokescreen for a lack of substantive action at the structural level?
LG: They had a very real faith that these micro-solutions could address poverty on a macro scale. And it is important to recognize that these are not bad ideas in and of themselves. It’s not that microfinance is terrible; it’s just that it can’t solve structural inequality. If these programs were implemented, for instance, in addition to a big social welfare expansion, then they would function better as anti-poverty solutions. But because the Clinton administration did the opposite, they set many of these programs up to fail. And these programs were indeed a way to avoid having to argue for redistributive policies. In the end, these micro-solutions both reinforce the power of the market—because they’re based on the techniques of consulting and especially of the emerging high-tech sector—and at the same time they don’t require much expenditure of political or economic capital. They don’t require rich and powerful people to give very much over.
JL: While the book focuses on politics and policy, it can also be read as a cultural history of how a certain set of ideas about the relationship between personal behavior, the state, and the market becomes hegemonic in America’s political class. The phrase “doing well by doing good” is how you characterize this view that markets can solve social problems, and that personal enrichment can be reconciled with civic contribution. To what extent is this still the way the political class thinks about the economy and redistribution?
LG: That dimension of the book comes in part from personal experience, watching people around me in college in the late 1990s and early 2000s, and then later my own students, going to work in the private sector, in investment banking, but still remaining Democrats. I was struck by how these people were so invested in the faith that the market could do good. I wanted to figure out where that logic came from. What I found is that its roots are in the 1990s, when this idea is starting to be sold, and that the broader worldview takes shape in the 2000s. Recently, however, I have noticed a shift. There are still students going to work in the private sector, but not with the same kind of optimism and enthusiasm, not with the belief that the private sector could solve major societal problems. The 2016 election, and certainly the Democratic primary, played a role in catalyzing that. And of course, before that, there was Occupy. Still, the Obama administration really sold those small-scale kinds of programs and celebrated entrepreneurialism. I don’t see that quite as extensively right now in either party. But this cultural shift hasn’t been translated into wide-scale policy changes.
JL: How does the trajectory of Silicon Valley fit into this story, both in terms of the policies that tech entrepreneurs sought to promote, and in terms of what Silicon Valley came to represent?
LG: Silicon Valley gloms onto the Democrats and the Democrats glom on to them. There is this mutual understanding of shared goals. And, of course, while there has been a shift in the public perception of Silicon Valley, tech executives have more money and more power than before; they’re just not selling their solutions in quite the same way that they did. But in the 1990s there are all these striking examples. Take Reed Hastings, the founder of Netflix, who is also a major champion of charter schools. He genuinely believes in using market-based ideas to change the way government works; he’s a Democrat. We tend to think of charter schools as a Republican solution—but it was very much initiated by the Democratic Party, which first promoted the idea through an alliance with Silicon Valley, billing it as a way to make schooling more efficient.
I wanted to challenge the common view that the story of US politics after 1968 is solely about the rise of the right, and that the Democrats adopted the policies that they did as a way of playing electoral defense. That misses the fact that much of the promotion of market-based thinking—not just on welfare reform but also financial deregulation—by the Democrats happened because Democrats genuinely believed in them. The DLC had an explicit, affirmative project; it was not just a defensive reaction or an attempt to outflank the right. Of course, there is always an element of strategy: charter schools were the Democrats’ answer to school choice, which the Republicans were pushing.
JL: There’s a lot of talk on the left, right now, about the limited possibilities for transformative, redistributive politics given the dominance of affluent knowledge workers in the Democratic Party. In tandem, there’s a broader conversation about class dealignment—working-class voters abandoning the parties once aligned with organized labor, often for parties on the right—across the West. Was the rise of the DLC and its takeover of the Democratic Party a response to a process of class dealignment that had already started, or was it a catalyst for dealignment, as some argue?
LG: In my first book, Don’t Blame Us: Suburban Liberals and the Transformation of the Democratic Party, I show that it was a trend that was already happening years before the 1990s. Knowledge workers had been moving toward the Democratic Party starting in the 1960s. Other politicians, a generation before the DLC—those known as the Watergate Babies—were well aware of this. George McGovern also did very well with this demographic and made explicit overtures to them; he understood that they had come to hold more power in the party. The DLC builds upon that. In the 1990s, it’s more the moderate suburbanites that the Democrats are now trying to bring in. There is an understanding that the electorate is starting to polarize, and the Democrats are looking for potential swing voters. Moderate suburbanites are reliable voters; they also require less extensive voter outreach. By contrast, the Jesse Jackson model, which focuses on turning out the vote among the poor and working-class—that takes a much bigger investment. The turn to suburban moderates also fits with broader ideological aims of the DLC.
JL: To illustrate the DLC’s thinking on electoral strategy, you highlight a 1989 paper titled “The Politics of Evasion,” written by political scientists William Galston and Elaine Kamarck for the DLC’s conference that year, in which they argue that Democrats should try to lure back white ethnic voters in the North and white male Protestants in the South, whom they call “the heart” of the electorate. When I read that, I was struck by how similar it sounds to contemporary debates about the Democrats and “the white working class.” Are we still having the same argument from 1989?
LG: The late 1980s was a time when a lot of people who are still active in politics came of age. Even as the Clintons themselves have lost the stature they once had, their legacy lives on through many different people. The debates about the electoral direction of the party in the late 1980s and ’90s do have clear parallels to today. But this is not because history repeats itself, but rather because these are fundamental tensions within the structure of the Democratic Party. Every so often a candidate like Bill Clinton or Obama can paper over those divisions, but they’re always there. There is a constant ideological battle about which direction to go in. This is often told as a story about strategy, but it isn’t just about that. At its core it’s about who should have a bigger voice in the party and whose interests should be represented. Should the Democrats focus on working-class people of color? Or should they pursue moderate suburbanites, who are in some ways an easier win? The latter might yield short-term electoral results, but there are real long-term consequences to making that the center of your electoral strategy.
Nevertheless, we are at a very different point today. While there are obvious parallels to the 1990s and a somewhat similar set of dynamics—a Democratic president who came in with his party in control of both the House and the Senate, who’s facing the challenge of inflation—there’s more opposition on the left, and there are more demands for change. Given the convergence of such crises right now, it seems like there is a greater potential for transformative change than there was then. But change may have to happen outside of the Democratic Party.
Another important difference is that whereas Clinton had a coherent ideological program, Biden does not. He claims he’s going to follow the will of the mainstream of the Democratic Party (whether or not that’s actually what he’s doing is a separate question). But Clinton and the DLC wanted to fundamentally change the direction of the party. While Clinton succeeded ideologically, he did not achieve what he set out to do electorally: He did not manage to create a new permanent political realignment. That is, in part, why we are still grappling with some of the same questions.
JL: There’s also the Republican Party, which today is even more extreme than it was in the 1990s. The Democrats may still be having a debate that’s roughly structured by the same ideological parameters they had 30 years ago, but that’s not true of the Republicans.
LG: Yes, there was way more bipartisan legislation in the ’90s. A lot of Clinton’s micro-programs received substantial Republican support. That’s not the only reason Democrats under Clinton pursued these policies, but these market-based proposals were also a way to maneuver in that particular political moment. Clinton’s microfinance initiatives, community development banking—these received a lot of Republican Party support. It seems unlikely they would receive this same level of Republican buy-in today. That speaks to a shift in the Republican Party’s priorities but also in their strategy.
JL: By the end of your book, the picture of the Clinton administration’s legacy is damning. Reagan has come to stand in for the collapse of the New Deal order and the rise of neoliberalism. But in many ways, it seems like Clinton was able to do what Reagan—because he lacked sufficient support in Congress—could not, and dismantle much of the welfare state?
LG: The major changes that people associate with Reagan actually happened under Clinton. When that story is told, however, it’s often about how Clinton did what he did because he was ideologically indistinguishable from right-wing neoliberals, or because he feared losing elections. But he really believed that micro-solutions could make major changes, that by giving people responsibility, an important key word for Clinton and the DLC, the mechanisms of welfare would work better. And on the flip side, that transforming the regulatory state would encourage competition, which would bring economic growth, and which in turn would help people out of poverty. Clinton had a belief in the government’s duty to help people that was missing from the Reagan moment. And it was not just Clinton. Robert Rubin—Clinton’s first treasury secretary, a former Goldman Sachs banker and later Citigroup executive—was also a believer; he wanted to help poor people, but through market mechanisms. So while the Clinton administration’s policies might have been cruel in their outcomes, they were not cruel in intent. And it is really important to understand that intent, because that is how the DLC and Clinton were so successful in selling their political vision.