Wednesday, August 04, 2010

Ominous political developments

Obama's commitment to an impossible "post-partisanship" and his dedication to the neoliberal ideology have laid a number of traps for his Presidency and for the Democratic Party. Not to mention producing some bad policy decisions.

Here are some ominous recent developments in that regard:

  • Missouri voters adopted by a 71% margin Proposition C, a state initiative that not only opposed the individual mandate in Obama's health care reform, but in a throwback to John C. Calhoun also adopted a state nullification measure to prevent implementation of the federal law in Missouri. (Did Missouri outlaw basic civics education 50 years ago or something? I'm surprised the state's Secretary of State even allowed something like that to go on the ballot.)(Jason Noble, Missouri sets up challenge to federal health care law Kansas City Star 08/04/2010; an apparently earlier version of Noble's story put the margin at 75%.)
  • Apparently determined to declare a near-miraculous bounceback from the BP oil disaster, the Obama administration came up with an assessment of continuing risks on oil in the Gulf of Mexico that sounds like it could just as well have been prepared by BP's public relations office. (Justin Gillis, U.S. Finds Most Oil From Spill Poses Little Additional Risk New York Times 08/04/2010)

  • Referring to those reported findings, Obama's energy adviser Carol Browner commented on the Today Show, "It was captured. It was skimmed. It was burned. It was contained. Mother Nature did her part." (Lauren Frayer, BP Says 'Static Kill' Effort Is Plugging Gulf Well AOL News 08/04/2010) Browner's statement may well be remembered along with Obama's now-infamous comment on April 2, "Oil rigs today generally don't cause spills. They are technologically very advanced. Even during Katrina, the spills didn't come from the oil rigs, they came from the refineries onshore." (Steven Thomma, Obama overlooked key points in giving OK to offshore drilling McClatchy Newspapers 06/11/2010)
  • Treasury Secretary Tim Geithner issued an op-ed in which its hard to tell whether he was trying to sound more like Herbert Hoover or more like Pollyanna: Welcome to the Recovery New York Times 08/04/2010. Meanwhile, he assured Wall Street banksters they had nothing to fear from the Obama administration: Brady Dennis, Geithner tells bankers not to fear new financial regulations Washington Post 08/02/2010. "Your core challenge is to restore the trust and confidence of the American people and your customers and investors around the world," he told them, in prime Hoover form.
  • Richard Wolf reports for USA Today (Poll: Waning support for Obama on wars 08/03/2010):

    Public support for President Obama's Afghanistan war policy has plummeted amid a rising U.S. death toll and the unauthorized release of classified military documents, a USA TODAY/Gallup Poll shows.

    Support for Obama's management of the war fell to 36%, down from 48% in a February poll. Now, a record 43% also say it was a mistake to go to war there after the terrorist attacks in 2001. [my emphasis]

Basically, the percentage on support of Obama's war policies is extremely unlikely to drop below 30% or so in any case. So, in other words, it's getting close to hitting bottomI recently read an account of recent German political history that described 1970-72 period, when Willy Brandt was Chancellor and was making major strides in easing Cold War tensions with the Eastern bloc, as a tragically missed opportunity for domestic reform. I'm worried that we may look by on the 2009-10 period as a similarly lost, squandered opportunity for major constructive reforms. Robert Reich recently wrote, "Whatever the outcome of the upcoming midterm elections, the activist phase of the Obama administration has likely come to a close."(The orgins of the enthusiasm gap Salon 08/03/2010) We won't know until years from now whether that's what we're experiencing right now, the last month of a squandered chance for reform. The owl of Minerva flies at dusk, as Hegel famously said of not being able to understand the real nature of an historical period until it was passing away.

The health care reform, as progressives pointed out during the long, painful process of passing it, wound up with serious policy flaws that could also become political problems. Under the private-insurance-based structure the reform set up, accessibility to insurance could only be guaranteed by a "robust" (effective) public option to provide competition to the private carriers. The reform allows high deductibles while requiring most individuals to buy private health insurance. It's painfully obvious this could force people to buy costly junk insurance that wouldn't actually cover the actual health expenses they incur in a given year. Despite the valuable aspects of the reform, that's a gaping hole in the new system. Marcy Wheeler gave a good description of the basic problem in Health Care on the Road to Neo-Feudalism Emptywheel 12/15/2009.

Missouri's Proposition C illustrates one of the ways Republicans can use that gaping hole effectively to attack the whole concept of guaranteed health insurance. They can make the argument that health care reform forces people to buy health insurance they don't want and thereby deprives them of personal choice over their own health care. The fact that the implementation of most of the reform's provisions was pushed back to 2014 magnifies the political problem for defenders of the reform. People can see the problem of the individual mandate but can't yet see most of the benefits in practice. And the truth is that the reform as it stands with the possibility of high deductibles on individual plans and (especially) no public option is really likely to force some people to buy health insurance they don't actually get any benefit from for years at a time.

I don't believe the Republicans will ever abolish the individual reform, because it's a huge profit boost for health insurance companies, especially if they can get away with using high deductibles on the individual policies. But the Republicans will continue to use that as an argument against the Democrats. Missouri's vote Tuesday indicates that it can be effective.

The right solution to problem is to maintain the individual mandate (to prevent individual from gaming the system by only buying health insurance once they get sick) and set up a robust public option along with much tighter restrictions on the deductibles private insurers can impose (to prevent the insurance companies from gaming the system through exorbitant prices and poor service). An even better solution would be Medicare for all. But the Democrats let that option go by during the past two years, using the filibuster excuse to hide behind ("we can't get 60 votes in the Senate") in order to stick to the agreement the administration made with the industry to leave out the public option but include the individual mandate. (David Kirkpatrick, Obama Is Taking an Active Role in Talks on Health Care Plan New York Times 08/12/2009; Miles Logulescu, NY Times Reporter Confirms Obama Made Deal to Kill Public Option Huffington Post 03/16/2010)

At the Netroots Nation conference this year, the only speaker I heard use the term "neoliberalism" was AFL-CIO President Richard Trumka. But it's a very useful term, referring to the rehabilitation of essentially Herbert Hoover free-market economics in a nominally kinder, gentler form. Also known as the Washington Consensus, a term that has somewhat faded from usage in the 2000s, the basic elements of the neoliberal policy are described as follow by

Here is how the President put his spectacularly ill-timed decision to expand offshore drilling, framing it in his favorite Broderian manner:

So the answer is not drilling everywhere all the time. But the answer is not, also, for us to ignore the fact that we are going to need vital energy sources to maintain our economic growth and our security. Ultimately, we need to move beyond the tired debates of the left and the right, between business leaders and environmentalists, between those who would claim drilling is a cure all and those who would claim it has no place. Because this issue is just too important to allow our progress to languish while we fight the same old battles over and over again. [my emphasis] (Remarks by The President on Energy Security at Andrews Air Force Base 3/31/2010)
That statement combines the underlying false assumption of neoliberalism, that the interests of corporations and the public interest are essentially in harmony and therefore "the business of America is business" (as Calvin Coolidge famously put it), with the Democratic Party/left version of neoliberalism, which is to sell a falling standard of living and declining security to a union and working-class constituency.

Jamie Galbraith in James K. Galbraith Champions The Beast Manifesto The Daily Beast 08/02/2010 explains how this obsessive splitting-the-difference approach causes trouble, here in the context of the Afghanistan War and the potential Grand Bargain lurking in the background to phase out Social Security and Medicare:

This is a pernicious idea, with two major foundations. One is the simple political appeal of a balanced argument - the same as Obama's decision to stay in Afghanistan while leaving Iraq. It's nice to have things both ways, to be for stimulus now and austerity later. The problems come, in war and economics, when you have to deal with the consequences, for real people, of actions taken largely for rhetorical effect.
And, as the BP oil disaster shows, the interest of corporations and the public interests are not identical and in fact are often directly opposed in important ways.

Leaving aside any faults of character or intent to do harm, the purpose of corporations is legally defined to be maximizing value to their shareholders. Given the current stock market rules, that translates into an extreme emphasis on showing improved earnings every quarter. And beginning with the Reagan tax cuts of 1981, the structure of executive compensation at corporations has shifted heavily to direct compensation and away from corporate perks like the company jet and so forth. This means that corporations are under heavy personal and institutional incentives to minimize liabilities and bad news in the short term and always paint the rosiest scenarios for their own company's future.

So no one should be surprised that BP in recent months has sought to low-ball estimates of the oil spilled, employed the toxic dispersant Corexit to minimize visible surface oil, and generally has tried to minimize the current and long-term damage they have done with the Macambo/Deepwater Horizon catastrophe. In a real sense, that what they are supposed to do, arguably even what the law requires them to do.

But it's outrageous for the people's government to make it their goal to be boosters for private corporate interests. We should be able to count on the federal government to defend the public interest against companies like BP when they damage it. Certainly corporations have no qualms about taking an adversary position against the US government when their profits seems to require it. But the public should be able to count on our elected government to defend our interests in priority to the interests of a corporation like BP. And we especially should be able to count on the Democratic Party - that has long styled itself as the Party of the People - to defend the public interest against private greed.

The Obama administration could have and should have used the BP disaster to make that point, to assert the necessity for strong and honest regulation, and to challenge the neoliberal narrative. Let's assume for the moment that the cockeyed optimism the administration is projecting over the degree of harm done by Deepwater Horizon is accurate. He could still have framed those findings as being highly preliminary, emphasized the amount of oil allegedly still there and the uncertainties created by the unprecedented depths of this massive "spill" and the unknown effects of the Corexit dispersant, and used it to challenge the corrupt and destructive neoliberal narrative of economics and policy.

Instead, Obama seems to be pandering to what Peter Daou in a couple of tweets labels "Gulf denialism":

In many ways, #Gulf spill denialists are mirror images of #climate denialists - same MO, same long-term damage to humanity
Worst offenders on #Gulf denialism are White House/Dems who want the issue to go away and would rather not highlight damage & drilling risks
Actually, I would prefer to leave BP and the oil industry as the worst offenders, but I certainly understand Daou's point.

I think of it more as, "What the [bleep]?!" If the news is so happy, maybe the government and BP will release the scientific data for independent analysis, instead of making groups like the National Wildlife Federation sue to get it released, as they are currently doing.

The problem of American militarism is larger than just the neoliberal ideology. But neoliberalism in its American variant creates a heavy bias toward pampering the military-industrial-espionage complex. And the neoliberal bias toward privatization has created a huge market for private mercenary and spying businesses, whose implications are only beginning to be understood by the general public. (And scarcely at all by our Pod Pundits and star reporters.)

And Obama's policies on the Afghanistan War, government secrecy and protecting the torture perpetrators, combined with the "postpartisan" desire to appease Republicans and punch a hippie ("move beyond the tired debates of the left and the right") have led him to pursue a spectacularly ill-advised escalation in the Afghanistan War.

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