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Tax Deal

I have long argued that Obama’s pr people were failing him, and I speculated that because they plunged into the Presidency without any rest from the campaign, they were simply exhausted. Whatever the actual reason, it’s now clear that Obama and his team never heeded the good advice of people like George Lakoff and Drew Westen, who laid out excellent prescriptions for how to communicate about progressive policies. So we find ourselves today in the following economic position:
As a whole, the economy is slowly and weakly recovering from the Great Recession.
Large banks and wealthy investors are doing very well.
Unemployment rates remain near 10%, with the actual number probably closer to 20% and the hardship much worse for minorities and the young.
The savings and wealth of the American middle class has been decimated.
The Tea Party/Republican party will rule the House from January 1, and will use its position to impose fiscal blackmail on all federal programs other than defense spending, not to mention doing their best to foil government activity by holding non-stop hostile hearings.
The possibility of any further fiscal relief for States or for poor or middle class people during the next two years is nil. As is the possibility of any federal “stimulus” money.
The goals of the conservative are twofold: first, to defeat Obama in 2012; second, to return the federal government to its pre-civil war role in which virtually the only legitimate activities were considered to be national defense, the collection of geographic information, and the management of public property.

This is the context of the tax deal. What does the tax deal do? Of the 900 billion cost, three quarters go to direct economic stimulus, which not coincidentally also saves millions of people from desperate misery at a time when they cannot possibly help themselves. The remaining quarter does go to the billionaires, who will not spend any appreciable part of it for the national benefit, and is a dead loss. But it is the ransom they require, and what we get in exchange is really important. Without this deal, Obama’s loss in 2012 would be assured, as would the return of a Depression era like we have not seen in our lifetimes. Nor would any other significant legislation have a chance now, such as the START treaty, the HOPE bill, and the DADT bill. With this reform, some or all of those bills might pass, even though they stand no chance whatsoever in the new Congress.

My interpretation of Obama, as a result of this deal, is that he has his eye on the practical realities for people. He is completely pragmatic, and like any good negotiator or deal maker will trade off unpleasant concessions for what he really needs and wants.

Why Democrats Did so Badly

I have been trying to figure out why the Democratic majority in Congress proved to be such a failure. Here is what I conclude. The fundamental reason for the failure was the Senate's filibuster rule. Without 60 votes, the Democrats were essentially helpless to get anything passed. The result was the mishmash we all saw. So the question becomes, why didn't the Democrats change that rule when they came to power in 2008?

The answer, I think, is the same reason why people don't keep their kitchen knives under lock and key. The filibuster was a tool that had never received much use, except when a minority of senators was very deeply and strongly opposed to something, as in the case of Southerners opposed to integration. While the Republicans began using it more often after 2006, it remained only an occasional factor since it was very difficult to rally so many senators to an obdurate stance. 2008 brought about an enormous change. So many moderate Republicans lost, and the party became so dependent on a particular segment of wealthy donors, that the remaining Republican senators could be induced or bullied into total unanimity whenever the leadership required it. McConnell began using the filibuster in a totally new way, as a day to day tactic, and this proved remarkably successful since the Democratic majority included a considerable number of rather conservative "blue dogs," and it only took one of them to make the filibuster succeed. By the time this tactic emerged, the time period during which the rules could have been changed had passed, and therefore the Democrats could not prevent the filibusters.

What remains unclear to me, however, is why Reid did not force the Republicans to actually filibuster, instead of simply winning cloture votes.

The new US constitution

I think we are ignoring several enormous changes that have transformed the US from the hope of the world into a new form of corporate state: (1) since Eisenhower, if not before, the military has become a huge, wealthy, and independent power with its own rulers, its own priorities, and a lordly presence around the world. It will continue to absorb the lion's share of our wealth regardless of the economic and social consequences. (2) Beginning with Reagan, the rich have become vastly wealthier and more powerful compared to everyone else, while middle class and blue collar community and labor organizations have dwindled. Bottom line: wealth now dominates our politics. (3) The George W. Bush presidency destroyed something like $12 trillion of US wealth, mostly in the form of middle class home investments. This one time destruction of wealth vastly exceeds all the losses of all the European powers outside Russia during World War II, and because of other changes enumerated here it cannot be recovered. (4) The Supreme Court's decision in Citizens United definitively marks the end of democracy in the US. Sure, democratic forms remain, and occasionally a rich candidate loses, but with only occasional exceptions, wealth now determines election outcomes. This may be particularly pernicious at the level of judicial elections. Although the judiciary remains for now what it has long been, largely committed to the rule of law, Citizens United and the efforts of groups like the US Chamber of Commerce guarantee that it will become increasingly partisan and corrupt as honest judges are replaced by those compliant with wealth, power, and ideology. (5) A key feature of "globalization" is that the major political actors--the largest corporations--no longer dependent on the American consumer for their profits. They have a sharply reduced stake in the economic viability of the nation, and are therefore relatively free to pursue public policies that further impoverish most Americans. To put it another way, just because a firm is headquartered in the US doesn't mean that it cares much about US conditions. Its leaders are insulated by their personal wealth, and its economic prospects depend on a far larger base than the US.

These fundamental changes render impotent and irrelevant liberal objections to the misdeeds of the present system. Unless an extraordinary new leader emerges, the system cannot be changed back to what it was. We thought Obama would be such a leader, but for all his qualities he clearly lacks essential public leadership skills, and there is no better choice on the horizon. The Republicans are now the only viable political party on the national level, and as far as I can see the only hope for amelioration of the depressing prospects is dissension within their triumphant ranks. Improvement will take a long time if it can be done at all.