Where's Your Core?
by Matt Stoller, Thu May 10, 2007 at 10:36:37 AM EDT
I remember having a conversation with a friend going off to join the Obama campaign awhile ago, and I brought up a bunch of generic criticisms. He hasn't done anything in the Senate, he triangulates against the left, etc. And she turned to me and said 'Matt, but don't you get it? He's one of us.' It was an interesting comment, one that I think courses through a lot of the Obama supporting community. He's asking for a different type of politics, therefore he's asking for my type of politics. But is that really the case? Here's a good example, an article on Obama's economic team. Former Bush officials Greg Mankiw lavished praise on his crew as a group of technically excellent economists that are "left of the political center, as one would expect, but only slightly".
When someone like Mankiw praises an economic team, it means that the team fits into traditional economic orthodoxy, which is very much tilted to the right. And the proof is plain to see.
Liebman, an expert on Social Security, isn't easily pigeon- holed either. He has supported partial privatization of the government-run retirement system, an idea that's anathema to many Democrats and bears a similarity to a proposal for personal investment accounts that Bush promoted, then dropped in 2005.
``Liebman has been to open to private accounts and most people in town would say he's a moderate supporter of them,'' said Michael Tanner, a Social Security expert at the Cato Institute in Washington, a research organization in Washington that advocates free markets and often backs Republicans.
In a 2005 policy paper Liebman, along with Andrew Samwick of Dartmouth College in Hanover, New Hampshire, and Maya MacGuineas, a former aide to Senator John McCain, advocated a mix of benefit cuts, tax increases and mandatory personal accounts to shore up the system, which will begin paying more in benefits than it takes in through taxes by 2017 under current actuarial estimates.
That's a rather stunning team player for Obama. Perhaps Liebman is an outlier and doesn't represent Obama's thinking, but I find that unlikely. The article continues.
Obama has called Social Security's problems ``real but manageable'' and has pledged to preserve what he's called the ``essential character'' of the pension program.
There are serious problems with Medicare, but Social Security is fine as long as the other financial shortfalls in the budget are dealt with. One of the key drivers of the right-wing frame in fact is the idea that 'entitlements' in general are in trouble, and so privatization ought to happen. Obama may or may not be looking for a new type of politics, and he may be engaging on a level that draws in new entrants into the process. Still, when combined with a team including people such as Liebman, this is very worrisome rhetoric, and gives ammunition to Clinton and Edwards backers.
And this gives rise to a question - why would Obama adopt this rhetoric and this team? It's an important question. It's not like the base loves the idea of privatizing Social Security, but there are groups that do, groups that have their home on Wall Street and in elite think tanks and universities (the ones Chait thinks are dispassionate). And I'm not a cynic who thinks that politicians just do whatever is politically palatable; I believe Obama believes what he said, that Social Security has real problems that need to be managed. Just as Clinton supports a continuing force in Iraq while telling us that she will end the war as President, Obama's campaign is wink-wink nudging the progressive base that 'he is one of us', while hiring a Cato-infused nut to help run his economic policy. Social Security is core. Iraq is core. It's strange that the two leading candidates in the Democratic Party don't consider them as such, and that the base is letting them get away with this nonsense.
We need better debates to bring this out, and more criticism.
UPDATE: Read this blog post on Clinton. She is very very strong, and we will not beat her without a compelling case. The triangulating model will only let her blur the distinctions on very clear issues, which is enough of an emotional excuse to keep her voters in line for the primaries.
Update [2007-5-10 18:21:24 by Matt Stoller]:: The Obama camp sent me this.
Audacity of Hope, pg. 179:
Take the Administrations attempt to privatize Social Security. The Administration argues that the stock market can provide individuals a better return on investment, and in the aggregate at least they are right; historically, the market outperforms Social Securitys cost-of-living adjustments. But individual investment decisions will always produce winners and losersthose who bought Microsoft early and those who bought Enron late. What would the Ownership Society do with the losers? Unless were willing to see seniors starve on the street, were going to have to cover their retirement expenses one way or anotherand since we dont know in advance which of us will be losers, it makes sense for all of us to chip in to a pool that gives us at least some guaranteed income in our golden years. That doesnt mean we shouldnt encourage individuals to pursue higher-risk, higher-return investment strategies. They should. It just means that they should do so with savings other than those put into Social Security.
I didn't mean to give the impression of saying that Obama wants to privatize Social Security. It's clear he's not sold on that option, and he opposed it in 2005. There are many ways to slice and dice this issue, though, and one of them is to raise payroll taxes a la 1983, which would essentially be another unnecessary regressive tax hike. For some reason that 1983 move is venerated as a wonderful example of cooperation instead of a horrible economic move. And I'm not saying Obama would do this, either, only that there are many ways above and beyond Bush idiocy to mess this up. Starting with the frame that Social Security needs 'a fix' is a great way to move to a place where damage can happen. Obama's support of Lieberman, for instance, suggests that he's temperamentally inclined to go for a 1983 style solution, and his rhetoric here and choice of advisors suggest he could substantively move in that direction. Then again, he could go the other way and suggest replacing payroll taxes with carbon taxes. The point is, who knows?