Union Successes in the Midwest but Will the Dems Take Credit?

          

          Organized labor's big (61%) win in Ohio to overturn the anti-collective bargaining rights law passed by the Republicans has led the governor to swear that he’s now heard the voice of the people.  In Michigan where the candidates for the Republican presidential nomination held their latest debate, all of the candidates affirmed their opposition to the bailouts of G.M. and Chrysler – they would have let them fail.  But Michigan’s Republican governor, Rick Snyder, said the bailout worked and urged everyone to look ahead – no need to thank President Obama.  But outside the Midwestern manufacturing belt or what’s left of it after over 3 million manufacturing jobs were lost since 2000, will Obama and the Democrats claim credit for the rescue of the U.S. companies?

One reason why it is difficult to claim credit is that “it could have been worse” (and it would have been much worse if the government hadn’t acted) is not a compelling slogan when there were a lot of losers who lost their jobs and when many of the winners took a bruising.  A second reason is that the ways in which a government (or political party) can help private groups to solve their inter-organizational problems are mostly by reinforcing a dynamic of problem-solving cooperation when the parties actually want to cooperate with each other, which was true of the two core groups in the big auto companies, namely the UAW and operations managers.  But this solicitude for the groups and the visibility of government support for them can look to others outside the charmed circle of solicitude – and by 2009 those outside the circle of union-management negotiations in manufacturing were the vast majority of Americans, even in Michigan, Ohio et al. – as placating special interests rather than serving the public interest. 

There is a huge technical literature about the logic of this inside-outside perception as well as political historiography that observes that “the public interest” has been defined to prevent government help to groups to overcome their collective action problems.  A hundred years ago the liberal-conservative slogan was “no class legislation”; everyone was an individual.  In order for Obama to claim credit for saving the U.S.-based companies (and the other companies, given the inter-twined supplier base), he has to make a strong case that “the public interest” was served by saving them.  Any particular benefit that the UAW and corporate managers and investors at G.M. and Chrysler received was incidental to the larger purpose of stabilizing a significant segment of the U.S. economy at a time of virtual free-fall in the national economy.  After all, what purpose in society does not have real individuals in a position to gain or lose from any public action?  Moreover, “if anyone asks” about the details, the rescue plans controlled the wages of incumbent union workers, drastically cut entry-level pay, cut health care, put tens of thousands on the unemployment lines, and banned strikes for four years.  What the administration’s rescue team also accomplished was to reinforce the reform coalitions within the companies that have been working on manufacturing performance and product quality.  The products are better and more fuel efficient.  The new contracts signed last month also brought back to the U.S. thousands of outsourced jobs.  But will anyone ask?  Who will tell the people?  Even Democrats have shied from taking credit.  They don’t want to appear too close to the unions and/or risk the charges from Republicans about crony capitalism (it is truly a weird world in which Republicans can make this argument with a straight face; just take a look at the careers of George W. Bush and Dick Cheney). Outside the Midwest, voters may be hostile to the rescue unless they get rescued, too.

But this is a bright spot in Obama’s record! The auto industry had been in a perpetual condition of upheaval since the original Japanese import surge in the late 1970’s, after which the Japanese car companies invested in manufacturing capacity in the U.S. in the 1980’s and 1990’s.  During these years the UAW and the companies were in a constant mode of contentious reform.  By the time that the Bush administration bailed out G.M. and Chrysler in December 2008, the companies’ managers and unionized employees had already made dramatic improvements in manufacturing practice.  Thus, the key to Obama’s auto rescue was less about the exogenous forces of global market competition and a controlling state and more about the accession of a knowing political coalition that empowered the reformers to pursue their goals. The Obama administration seized an opportunity created by the Bush bailout to build on the growing experience with industry restructuring to reconfigure the place of the companies in the U.S. industrial landscape.  As UAW president Bob King argues, the American companies are now the best practice in the industry because they have advanced manufacturing and worker representation.

The institutional presidency was an important resource for the U.S. auto industry’s adaptation as it can be for reformers of many stripes. Yet comparative political analysts typically claim that the U.S. government does not have the capacity to restructure an industry.  But that’s wrong in this case.  The presidency’s authority in economic policy may empower a president to act when this authority is enhanced by the broader network that brought him to the office.  In Obama’s case, the presidential coalition included significant new resources from private equity banking and management consulting, which had been developing new capabilities of their own since the industry policy debates of the 1980’s.  These groups extended their expert services to the White House for the restructuring and enabled the mostly successful rescue because they supported the union and management reformers in the companies.

What’s a Moderate Journalist Worth?

     For too long our mainstream news reporters have followed the journalistic convention that Congressional Democrats who vote with Republicans are “moderates”.  This is a purely Republican rhetorical construct repeatedly used by Mitch McConnell and company, which has been well dissected by Jonathan Bernstein.  

     During the long drawn-out negotiations with such so-called moderates about the Affordable Care Act, the law was weakened to the point that the bill’s primary accomplishment – if  not overturned by the Supreme Court next spring – is that the federal government will subsidize Americans to purchase private health insurance plans. There is nothing moderate about this outcome:  it leaves all the for-profit players in control of the health system and has virtually no cost controls whatsoever. 

     The latest triumph of so-called moderation occurred yesterday when Democratic “moderates” in the Senate supported the Republicans’ filibuster of one piece of President Obama’s Jobs bill.  Tonight, the News Hour duly dubbed the renegades “moderates”.  What is moderate about voting against a proposal to keep police, firemen, and teachers on the job at the cost of a ½ of one percent tax on incomes over $1million?  An individual with an annual income of $1.1 million would pay $500 more in taxes beginning with the 2013 tax year! What is not moderate about that? The tax would keep hundreds of thousands of public employees at work. The president had proposed a tax increase for household incomes over $250,000, but Senate leaders reduced the tax take to a surcharge on millionaires.  Even Karl Rove’s outfit’s polls found that surcharge was supported by two-thirds of the American people.  

     When will the News Hour and other “moderate” news reporters wise up and escape the Republican narrative?  

Repudiation, Not Responsiblity

Just as the President is gearing his rhetoric for combat with the Republican No Deal Party which won’t pass his new jobs plan, the Vice-President is muddying the message:

Vice President Joe Biden acknowledges that it’s time to hold the Obama administration’s feet to the fire for the sorry state of the U.S. economy instead of continuing to blame President George W. Bush.

“Right now, understandably — totally legitimate — this is a referendum on Obama and Biden and the nature of the state of the economy,” Biden said during an interview with South Florida public radio station WLRN this afternoon.

Biden made the startling comment during an interview in which his main goal was to pitch for support of President Barack Obama’s American Jobs Act.

The vice president dismissed polls in which people continue to blame the Bush administration for the economy.

“Even though 50-some percent of the American people think that the economy tanked because of the last administration, that’s not relevant,” Biden said. “What’s relevant is we’re in charge. And right now we are the ones in charge and it’s gotten better, but it hasn’t gotten good enough.”  (September 29, 2011 Newsmax Wire)

Biden has not received the message that turning the other cheek is no longer strategy.  To the contrary, what the White House needs to do is to repudiate the past regime.  The economy is not progressing because of the enormous failures of neo-liberal ideology as a philosophy for governing the country.  The failures are well-known – the gross irresponsibility of the financial CEOs, the regulatory failures to prevent dangerous food in the food supply, the failure of the tax code to get the extremely rich and powerful to pay their fair share, the scape-goating of the unionized middle-class, the BP blow-out in the Gulf, the enormous unfunded expense of the war in Iraq, and on and on. These are Republican problems caused by Republican policies and the President is not responsible for them.  Without repudiation of the past policies, the Democrats cannot change the subject and take the country in a new direction. 

Now and Then

September 29, 2011

Compare Obama in Colorado this week:

“If asking a millionaire to pay the same tax rate as a plumber or a teacher makes me a class warrior, a warrior for the middle class, I will accept that.  I’ll wear that as a badge of honor because the only class warfare I’ve seen is the battle that’s been waged against the middle class in this country for a decade now”.  (New York Times, September 28, 2011) 

and Franklin Roosevelt running for re-election in 1936, speaking at Madison Square Garden:

“For twelve years this Nation was afflicted with hear-nothing, see-nothing, do-nothing Government. The Nation looked to Government but the Government looked away. … Powerful influences strive today to restore that kind of government with its doctrine that that Government is best which is most indifferent….

We had to struggle with the old enemies of peace--business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.

They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob.

Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me--and I welcome their hatred.”

Many commentators have claimed that President Obama finally has his mojo back.  But there are important differences between 1936 and 2012.  President Roosevelt went on to specify the lies that the Republicans were telling about Social Security pensions and unemployment compensation and to call out the threats of unemployment that came from employers and the crocodile tears shed by Republicans about the poor working man.  He had an expectation that details of his message would be received and heard.  Also, Roosevelt had a mass movement pushing from the populist left:  general strikes in Minneapolis and Seattle and Toledo, militant unionizing in Michigan, a radical movement of the unemployed, and marching veterans and the elderly.  There was a mobilized electorate, funded by the Mineworkers Union and galvanized by the President’s rhetoric. 

     Today, we have episodic mass action, best expressed by the public sector unions in Wisconsin and other Midwestern states which, while very impressive in inspiring a 50-state demonstration of support, lost the first round of the battle and has dissipated as a national movement since.  More recently we’ve seen the “occupy” movement blossom from Wall Street to spread to every big city.  This is a different, younger and less focused group of folks than we saw in Wisconsin. It has been sparsely reported; the rightwing populism of the Tea Partiers still gains the media’s attention.  The Tea Partiers have turned full-face toward 1936-style Republican tosses of sand in the eyes and their blandishments that the government is picking the pocket of the working man with dastardly programs for health insurance and spending on infrastructure and schools, all the while they are protecting hedge fund managers, bankers, and multinational CEOs.  Who will tell the people, as William Greider put it?  I’m afraid the Obama for America campaign is no match.

Lessons Ten Years After

September 24, 2011

David Cole’s article in The New York Review of Books (September 29, 2011) argues that the rule of law in the United States was protected very well against the broadside assault against civil liberties launched by the George W. Bush administration in the wake of the terrorist attacks in 2001.  He’s right that we should pause at least to note that, to the surprise of pessimists and cynics, popular and organized support for civil liberties forced the administration to retreat time and again. Many Americans and key government officials as well demonstrated their commitment to our historical values by directly opposing the Executive’s far-flung claims for unitary power.  These Americans no less than our soldiers embody the slogan “freedom isn’t free”.  The American Civil Liberties Union, among other organizations, became a highly effective vehicle for hundreds of thousands of new members to push back the incipient police state.  

Now there is every reason to continue to press the Obama administration to repudiate rather than continue some of the ugly legacies of 9-11, including extra-judicial murders and the suppression of speech and press.  The Justice Department should conduct criminal investigations of the previous administration’s leading figures, who have bragged about their torture policy, up to and including Vice-President Cheney.  The Senate should approve the President’s nominees for the Privacy and Civil Liberties Oversight Board, which was one of the key recommendations of the official 9-11 Commission. 

Summer Blues

September 17, 2011

     I haven’t been posting recently because of demands at work.  Here are comments from August and July sent to news media, two of which were published.

August 15, 2011

     Sometimes it's better to have a little more information about stories that seem familiar to us because key words are invoked that are inherently vague, such as "Congressional dysfunction" and partisan gridlock.  The partial shutdown of the Federal Aviation Administration was caused by House Republicans, who wanted to close small airports and reverse a rule for airline unionization.  We're told that the National Mediation Board "relaxed union election rules" after President Obama appointed two new members to the panel, which suggests a partisan tilt to the decision.  How reasonable is the Republicans' objection?  The new rule for union representation elections says that whoever receives the most votes in an election is the winner. The old rule counted non-voters as votes against union representation. With that standard for election, most of the Republican House members would not be in office today.  The turnout in the 2010 elections was 40%, slightly higher than the long-term average for off-year Congressional elections.  As usual, the party of non-voters swept to victory.  Goodbye Republicans.

July 28, 2011

     As we close in on the federal default date, the media is treating the debate as it does presidential elections as a horse race between candidates. But focusing on whether the Republicans or Democrats promise the greatest reductions in government spending is no more useful than which presidential candidate is leading in the polls when citizens have to make up their minds. When the parties promise huge cuts in spending, it is not merely the total we need to know, but the specific programs that will be cut.  The Republican House already passed a budget resolution to turn Medicare into a voucher program for everyone under 55 years of age. Now, if you're a voter who thinks that's fine, that is OK, but the citizen who wants to keep Medicare will understand that this huge budget cut is unacceptable. The Republican plan also includes even greater proposed cuts -- which are reported in the aggregate -- which the Center on Budget and Policy Priorities calculates will lead not only to massive cuts in Medicare but also to cuts in Social Security Pensions.  Now, again, if you're a voter who supports cutting the income of seniors, then fine, but if you want to keep Social Security for yourself and the two-thirds of seniors who rely on Social Security as their primary source of income, then the fact that the Republicans can win the budget cutting race is irrelevant because the cuts are unacceptable.

July 26, 2011

     It couldn’t be about rightwing extremism, could it?  Ross Douthat, in his July 26 column about the murderous attack on Norway’s leading political party, the Labor Party, by a Norwegian Christian man steeped in the virulent xenophobia that flourishes on both sides of the Atlantic, wants us to believe that the real culprit is the Labor Party, which would not listen to the fact that “Europe’s cultural conservatives are right”.  

     Everything that Douthat claims is “right” is wrong.  He sweepingly claims that immigration has left the Continent "more divided than enriched" – note the instrumental standard he suggests – whereas for decades most western European countries have feasted on cheap immigrant labor. That the economic slowdown, compounded by years of outsourcing by global companies, has created high unemployment certainly cannot be blamed on immigrants. About his claim that Islam and liberal democracy are “not yet proven natural bedfellows”, one wonders if he decided to weasel out – “not yet”, “natural bedfellows” – because he knows that the Christian extreme right does not support liberal democracy. Finally, he claims that “the dream” that the Continent will be ruled by a “benevolent ruling elite” is “folly” whereas it is precisely the insurgent extreme rightwing parties in many countries that have challenged the hope for a democratic (not dictatorial) European Union.  

     Douthat is still smarting from the fallout from Timothy McVeigh’s 1995 attack on the Oklahoma City federal building: “Timothy McVeigh’s connections to Republican politics were several degrees short of tangential, but Clinton successfully linked the heartland terrorist to talk radio…, implying that McVeigh’s crime was part of a broader story of antigovernment conservatism run amok.” He would like us to forget that several Republican members of the House played footsy with the Militia Movement’s armed groups, which engaged in military training precisely to combat the federal government.  McVeigh was deeply involved with the American extreme right.  Just as Jared Loughner is called “the schizophrenic”, now Anders Behring Breivik is “insane”.  He’s not one of our group!  We’re the sane immigrant bashers, xenophobes, elite class warriors, and Christian fundamentalists.

July 15, 2011

     A syndicated editorial cartoon of July 14, 2011 perpetuates a false story that the Democrats and Republicans are equally at fault for the budget crisis.  It shows a Democrat and a Republican collapsed on the floor.  The Democrat is labeled "Spend! Spend! Spend!" and the Republican is labeled "No tax hikes!" and the text reads "What happens when an irresponsible force meets an unreasonable object".  The truth is that Obama has agreed to trillions of dollars of spending cuts while the Republicans have not agreed to any tax increases. The Republicans are both irresponsible and unreasonable.  

     After all, the Republicans ran up the deficit with the Bush tax cuts ($4 trillion, mostly for the super rich), the Bush Medicare drug subsidies for the pharmaceutical industry ($500 billion), two wars paid for with debt (long-term cost $2 trillion and counting), the economic collapse of 2008, and the financial industry bailout. Now they don't want to pay their bills, which is the definition of irresponsibility.  It gets worse: the Republicans unreasonably want the middle class to pay for it all through benefit cuts (e.g. privatize Medicare for those under 55), lay-offs of teachers, police and firefighters, higher tuition at public colleges, banning collective bargaining about health care, and more, all the while protecting the vast privileges of the big banks and hedge fund managers. 

     The American voters have a more reasonable response, as shown repeatedly in opinion polls: two-thirds want to raise taxes on the super rich and big corporations, which have done very well under the Republican regime. 

Symbiotic Relationship

            Are journalists doing their job properly in the budget debate?  The Republicans have talked both parties into a stalemate, partly because few have challenged the Republicans’ premises about how the economy operates. 

                 Today (July 11, 2011) on the News Hour, we heard from two members of Congress, a Republican and a Democrat, about their views on the budget deadlock.  Unfortunately the interviewer, Gwen Ifill, asked weak questions that left the audience – as she not very helpfully surmised – without key information.  Can journalists help move the debate beyond he said/she said? 

When the Republican said that the American people want spending to be cut to balance the budget, Ifill might usefully have pointed out that the public also supports – and has supported by big majorities for two years – increasing taxes on the rich.  When the Republican argued that raising taxes on the “job creators” was a bad idea, Ifill might have noted that the “job creators” are jobs 11 million jobs short and that corporate tax revenue is at a 60 year low as a proportion of the budget.  When the Republican argued that most businesses are so small that their owners do not file tax returns as corporations but rather as individuals, Ifill might have pointed out that most businesses’ revenue is so low that they will not be taxed by any proposal that is coming out of the White House. When Ifill asked if the Republicans were willing to pay a political price as part of a deal with the Democrats, who also would pay a price to get to a compromise on spending, the Republican said it was a big and sufficient sacrifice for Republicans to agree to increase the debt limit.  No doubt the Club for Growth and the Business Roundtable will lambaste any tax increase.  Ifill might helpfully have pointed out that the Republicans seem to be willing to pay a serious political price with voters of modest incomes by their proposal to abolish Medicare for everyone under 55, which is extremely unpopular.  

When the Democrat got his chance, he excoriated the Republican’s smug sacrifice.  He agreed that the sticking point in a potential compromise was tax increases on the wealthy, which he argued was a matter of fairness.  The poor and elderly would be hurt by the House Republican budget whereas the rich would get off without paying an extra dime.  Ifill might have asked him how the Democrats’ position would stimulate economic growth and employment.  How does his concern for the poor and elderly help the working- and middle-classes?  As is typical, the Democrat never took on the Republicans’ economic analysis and therefore fell into the old trap of wimpy hand-wringing.  He was correct to reject the abolition of Medicare and any threat to the structure of Social Security pensions.  But that is simply defending the position that the Republicans argue the Democrats should compromise in order to get the economy moving again.  

Could we get past this old discussion? Could the Democrat actually challenge the Republican head on and say that the government creates jobs and should do so just because the private is not?  Could the Democrat point out that the profits of the large corporations have recovered from the Great Recession and the bankers are receiving lavish salaries once again and, therefore, argue that these business leaders are not hiring because the incomes of working class people are too low or insecure to give them confidence to buy things? And that it is a terribly misguided policy to have cut 430,000 government workers from the payrolls in the last 18 months – not only are these the people who teach and provide public safety – but laying off public employees creates unemployment every bit as much as laying off private sector workers.  That it is backwards to attack the ability of unions to negotiate higher pay in a recession when consumer incomes have stagnated.  Of course, the Democrat might say, we should tax very high income individuals and corporations because we need to put that money to work so that Americans can go back to work.