Neoliberalism and the Democrats

In my previous post on the effects of neoliberalism on the left parties of Europe and the United States, I mentioned a post of Digby's, Shop Teacher In Chief Hullabaloo 05/10/10, that I wanted to cite again because she sums up Obama's style very well. In a different time - say, 1995, it might have been encouraging. But coming to power as he did in 2009, in the middle of the Great Recession and on a wave of popular disgust with the outgoing Predator State administration and of hope in his own promises, Obama had a remarkable opportunity to dramatically shift the framing of political issues. But in many ways, he's a prisoner of his own development in the Democratic Party of the last 20 years. With particular reference to financial reform, Digby writes:

At this point there's no longer any reason to assume that Obama doesn't get it or is just trying to get his legislation through and doesn't want to alienate Republicans. He is what he appears to be, which is a dry, pragmatic, status quo, technocrat who makes symbolic leftward gestures while offering center right policies. The power of his iconic status is enough to create the illusion of idealism, which keeps him interesting. The Right is freaky enough to keep the left wary of going too far in challenging him.

But the right smells that he prefers to avoid fights, whether for psychological or ideological reasons, and they are successfully pushing him ever rightward while portraying him as a radical socialist. It's very clever. But then they are far more clever at macro-politics than anyone on the left.

When it comes to Obama's timidity on financial reform, she writes:

He knows that the "savvy businessmen" have made some boo-boos along the line, obviously, but it's not at all clear that he doesn't chalk it all up to some sort of act of God (or Invisible Hand) that was beyond the capacity of mortal humans to prevent. After all, these companies and banks are all run by very smart guys, who can't possibly be so stupid or greedy to create this mess by virtue of their own inadequacies or self-centeredness. They are The Best and the Brightest this country has to offer, and by the technocrat's definition that means they are important but dispassionate cogs in the great machine that makes the world work. If they are actually human fuck-ups and greedheads, what ever shall we do?

This is what I mean when I talk about the negative role of neoliberalism within the Democratic Party. As we saw during the Cheney-Bush Presidency, the Republican Party has embraced a Predator State model, which has deregulation and "free trade" in common with Democratic neoliberalism. But the Predator State model completely rejects the concern over the deficit, which may be the most destructive aspect in both policy and politics of the current neoliberal dogma in the Democratic Party. And the Republican model also largely rejects the necessary role of the state in providing a legal framework to make the "free market" function efficiently. They not only want to deregulate, they gut regulations actually on the books by stacking regulators with ideologues or industry veterans who go easy on those they regulate, and by not staffing them at all, i.e., by leaving vacancies for long periods of time in critical regulatory positions. As we saw in the obscene antics of Cheney's old company Halliburton during those years, the Republicans see the state as a way to redistribute wealth from the taxpayers to private companies through sweetheart contracts and a stereotypical Third World brand of crony capitalism.

Democratic neoliberalism is less destructive for the interest of working people and the general public that the Republicans' Predator State crony capitalism. But it's neither adequate as policy to restrain the financial buccaneering that brought on the Great Recession, nor adequate politically to prevent the return to power of a Republican Party committed to Predator State crony capitalism married (in its present version) to xenophobia, Jim Crow governance perspectives, and a very destructive militaristic approach to foreign policy.

Tags: barack obama, democratic party, neoliberalism