The American Left Awakens: As The Middle Class Goes, So Goes The Political Middle
It could be said that a democracy’s chosen economic model lives and dies by the prosperity of the majority. A thriving middle class has been the key stabilizing factor in American politics for generations. As such, systematic change in the United States has traditionally come slowly and incrementally.
But after a decade of zero job growth, while millions more Americans have continued to enter the labor market, they have witnessed unemployment rates rise and become fixed at levels rarely seen before. They have watched their wages drop, their cost of living rise (due in large part to high energy prices, high education costs, and runaway health care costs), and correspondingly, their quality of life erode.
The middle class is gradually disappearing from the U.S. landscape, and the ‘American dream’ is transforming into a fiction in the minds of millions.
This dream is based on an implicit agreement between the establishment and the masses, and is crucial for America’s brand of hyper-Capitalism to remain a viable economic model. It goes something like this:
If Americans work hard, and invest in a decent education, at worst they should expect a comfortable middle class existence, with prospects for future upward mobility based on merit and perseverance.
As long as this dream is deemed achievable in the minds of the majority, the political status-quo remains all-but a certainty. But the moment people stop believing it, the calls for serious systematic change begin to bubble up to the surface. And this is when the political middle dissipates.
Many economists hold that the dream actually vanished many years ago, but the establishment extended exorbitant lines of credit to Americans, which allowed them to enjoy a mirage of prosperity. In other words, a once prosperous nation on the decline became transformed into a debtor nation. But in doing so, the ‘American dream’ lived on in the minds of millions.
All it took was the massive financial meltdown of 2008, brought on by years of deregulation in the financial and mortgage industries, to pull the curtain wide open on the American dream. The collapse of the U.S. banking industry — which exposed a band of corrupted, highly-leveraged casinos masquerading as banks — rudely awakened Americans to their true state of affairs.
Twelve trillion dollars in ‘perceived’ wealth, mostly in home values, vanished into thin air. Many of those lucky enough to remain employed, found themselves under water with their mortgages. No longer able to sustain their middle class lifestyles with easy credit, consumer spending continued to dry up, and the economy spiraled even further into the doldrums.
The rationale George W. Bush and Treasury Secretary Hank Paulson used to sell the Troubled Asset Relief Program (TARP) to the American public was that if taxpayers bailed out these banks, they would in turn ‘loosen’ the credit markets by lending again to businesses and consumers, which would help to stimulate investment and demand.
Instead, the banks did just about everything, BUT resume lending. Having received amazing terms from the government, they invested in no-risk, interest-bearing Treasuries — to profit off the spreads and transaction fees. They paid themselves billions of dollars in the form of bonuses. In addition, these ‘Too Big to Fail’ banks used taxpayer money to buy-out struggling competitor banks, thereby growing even bigger.
Neither TARP, nor the $16 trillion in secret Fed loans to banks (both here and abroad), loosened the credit markets. Nor did they help millions of struggling Americans to stay in their bank-foreclosed homes. What the bail-outs accomplished was to send a powerful message to Wall Street: as long as these institutions remained ‘Too Big To Fail’ they could continue to take obscene risks, because the government could be counted on to cover their losses.
The effort was branded by most to be a colossal failure — a massive transfer of wealth from the ninety-nine percent to the one percent.
As the status-quo became untenable, many Americans began to abandon the political middle — once a seemingly ‘mainstream’ place to be — and split towards each end of the political spectrum.
Exiled from government, Republicans recast themselves as Tea Partiers — an ‘AstroTurfed movement’ that blamed ‘government’ for all the country’s woes. In particular, they blamed the new Democratic-controlled government, who’d been elected to clean up their mess. These right-wingers embraced pure unadulterated corporatocracy as the solution to problems created, ironically enough, by deregulated banks and corporations.
Democratic constituents felt relieved, having ushered Barack Obama into the White House on a populist progressive ‘CHANGE’ platform, along with Democratic majorities in both houses of Congress. The Left continued to place its faith in democracy — i.e. the ‘ballot box’ — as the appropriate venue for delivering change.
But once sworn in, Obama’s call for ‘Change’ insidiously shifted to a new call for ‘Bipartisanship’. He proceeded to prioritize ‘harmony’ between two diametrically-opposed parties over championing the progressive promises that got him elected.
Of course, this new ‘priority’ was merely a cover for appeasing the entrenched corporate interests. His largely-symbolic legislative victories were so watered down and corporate-friendly that they were routinely castigated by the Left. His advisers would complain bitterly how no one outside the White House would give Obama his due-credit for his ‘achievements’.
He governed like a pre-Tea Party Republican as he broke promise after promise. He proposed cuts to social security, Medicare, and Medicaid. He pushed the Bush-signed, NAFTA-like (job-exporting) trade deals which Congressional Democrats had defeated years before, and he even pressured Congressional Democrats to extend Bush tax cuts for the wealthiest 2%. In doing so, he grossly underestimated the populist angst that had swept him into office.
Obama’s duplicity led many of his once-energized supporters to conclude that America’s entire political process was something of a sham — that they’d once again been had.
And so they gave up waiting around for the Democratic Party to walk their talk, and took to the streets themselves in masses. On September 17, Occupy Wall Street began peacefully protesting in downtown Manhattan, and it has since spread like a forest fire into a nation-wide movement.
This huge, non-partisan, populist ground-swell blasts the Washington establishment for systematically exploiting and subjugating ninety-nine percent of Americans to appease the wealthy and powerful one-percent. The protesters demand an end to the corrupt and insidious relationship between government and corporations which perverts the very fabric of democracy.
“My biggest fear was that the Obama presidency was going to lead this generation of young people into political cynicism and political apathy,” Klein says. “But instead, they are going to where the power is. They are realizing the change is not coming in Washington because politicians are so controlled by corporate interest, and that that is the fundamental crisis in this country.”
It would appear the power-elite’s greed, corruption, and hubris has finally awakened a sleeping populist giant in the American people. And the longer the Democratic Party continues to promote policies right of center, the more those left-of-center will continue to detach from the party and the entire democratic process.
A new Washington Post/Bloomberg News Poll reveals that 44% of Democrats don’t believe the economy would get any worse should President Obama lose in 2012 to a Republican. Blue Texan from Firedoglake sums up this startling revelation:
“Let that sink in for a minute. The economy will be the number one issue in 2012 — and nearly half of the President’s own party doesn’t think it matters if he’s re-elected.”
Clearly, today’s definition of the political middle — which is where Obama loyalists contend he governs — has come to represent the painful and untenable status-quo to traditional Democratic supporters.
With No Exit Polls, The “Why?” For Dem. Coakley’s Senate Defeat Gets Spun
One of the most vexing revelations to come from last night’s Senatorial contest in Massachusetts was the fact there were NO EXIT POLLS. NONE! Not a single news organization conducted exit polls to ascertain a “why?” for such a huge, significant upset.
Surely, the networks knew the significance of last night’s election before a single vote was cast, and they clearly saw Coakley’s sliding poll numbers since January 5, when Rasmussen released a survey showing Republican Scott Brown trailing Democrat Martha Coakley by only nine points.
Call me a cynic, but you just have to wonder if the absence of exit polls wasn’t somehow intentional. Perhaps the beltway media establishment didn’t want to quantify the populist voter outrage which would likely incite a legislative turn to the Left, against entrenched interests.
By not conducting exit polling, the establishment accorded itself the opportunity to reframe the impending Democratic upset in the usual way: Obama needs to move further to the right to placate enraged Independents (whom they routinely misportray as nothing more than disaffected Republicans).
Ryan Grimm of the Huffington Post addressed the establishment’s reaction to last night’s Republican victory in Massachusetts as being focused entirely on the Independent voters; while largely ignoring the base:
With all the talk about “angry independents” deciding the special election in Massachusetts Tuesday night, the inclination among establishment Washington Democrats is to chase after them. Progressives, meanwhile, want the party to deliver on promises made during the campaign.
Not surprisingly, Democratic politicians are already indicating that they will likely shift rightward. Barney Frank seemed to suggest to Rachel Maddow, in reaction to the upset, “that without support from at least some Republican senators, health care reform, at least in this iteration, wouldn’t happen.” In other words, he interpreted this defeat as a need to appease the right — as if they haven’t been doing that all along. That move would certainly help him to water down even further his current banking reform initiative (as would also be necessary to gain Republican votes).
Anthony Weiner “suggest[ed] on MSNBC that maybe it’d really be better to drop health care reform–and pivot to jobs.”
Digby points out that Chris Matthews, in reaction to Coakley’s defeat, has now joined the deficit-hawk choir:
The predicted reverberations are already being felt. Chris Matthews is already going on about deficits being the most important problem in the whole wide world and how his daughter is really worried about government spending and taxes.
And the Democrats are subsequently making it much more difficult to fix the economy by playing into this deficit propaganda themselves.
The usual conservative voices, as one would expect, are all too happy to capitalize on the absence of exit polls.
Here’s Michael Gerson at the Washington Post, suggesting that Obama’s “liberalism” has infuriated Independent voters:
It means that Rahm Emanuel’s “big bang” theory of legislative liberalism is the most foolish political strategy in recent memory. It means that spending political capital on health reform instead of economic recovery and growth was a dreadful error. It means that a crisis that Obama didn’t want to waste has largely been wasted. […]
There is only one explanation for this remarkable turn of events. Americans thought Obama was a moderate. He certainly sounded like one. But now he is attempting to remake one seventh of the economy in a quick march of party-line votes. In the process, he has alienated independents in large numbers — even in Massachusetts.
Did you get that? According to Michael Gerson this isn’t about populist outrage from both the Left and Right; this is about Obama (who actually ran on a progressive populist platform) somehow misleading Independents into thinking he was more conservative than he really was. To Gerson, it would seem Independents have suddenly awakened to discover that Obama and his “liberal” cohort Rahm Emanuel are governing as some kind of commie-liberals.
David Broder never once mentions populist outrage in his column; no talk of Wall Street bailouts while turning a blind eye to the plight of Americans; no mention of Health Insurance and Pharmaceutical Industry giveaways off the backs of hurting Americans.
First he mentions voter concerns about deficit spending, and then he describes just how Republican victor Scott Brown was able to capitalize on the current Health Care Reform bill before Congress:
This allowed Brown to argue that he would vote against the legislation pending in Washington, which by comparison looks more expensive and more bureaucratic and more partisan than the Massachusetts model.
Perhaps subtle to some, but the word “bureaucratic” is actually a lightening rod term within Conservative circles. It conjures up images of an inefficient government run entity (i.e. the Republican stigmatization of a would-be public option — something which isn’t even part of the bill under consideration). In reality, the Senate Bill is clearly a giveaway to the private “for profit” health insurance industry — a dream bill to a corporatist like Broder.
The only Democratic politicos Broder spoke to were the ones who seemed to parrot the White House talking points:
“They were critical of Coakley’s campaign, arguing that it was a serious miscalculation for her to break off campaigning and advertising after her easy victory in the primary.”
Like Gerson, Broder implies it is more about ideological differences; meaning the “liberal” Democratic Congress and President are imposing their will on a more “moderate” electorate, and it’s backfired. Broder gives his readers two false choices to explain the Democratic upset: 1. voter repudiation of liberal initiatives (i.e. runaway spending and government ‘bureaucratic’ health care), or 2. a poorly run Coakley campaign (i.e. the White House talking points). Yet he never mentions the visible outrage bubbling over from the left, as Obama continues to sell out the American people to serve his corporate masters.
The reality is President Obama has been governing from right of center since the moment he took office. Liberals feel betrayed. The Democratic base couldn’t be less energized — thanks to all of Obama’s broken promises, and his backdoor deals with entrenched interests.
Ryan Grimm contends that Independents and liberals have indicated they want essentially the same thing: CHANGE.
A review of surveys of independent and Democratic voters show that both want much the same thing: change. Both groups are deeply troubled by the state of the economy and angered that bailed-out Wall Street firms seem to be the only ones to have recovered from the crisis. […]
“If Scott Brown wins tonight, he’ll win because he became the change-oriented candidate,” Celinda Lake, pollster to losing Democratic candidate Martha Coakley, told HuffPost before the election results came in. “Voters are still voting for the change they voted for in 2008, but they want to see it. And right now they think they’ve got economic policies for Washington that are delivering more for banks than Main Street.”
Ezra Klein from the Washington Post perfectly sums up the frustration from the Left:
A Democratic Party that would abandon their central initiative this quickly isn’t a Democratic Party that deserves to hold power. If they don’t believe in the importance of their policies, why should anyone who’s skeptical change their mind? If they’re not interested in actually passing their agenda, why should voters who agree with Democrats on the issues work to elect them? A commitment provisional on Ted Kennedy not dying and Martha Coakley not running a terrible campaign is not much of a commitment at all.
Joe Trippi, a longtime party strategist and high-ranking official on the Howard Dean and John Edwards campaigns told the Huffington Post:
“This needs to be a wake up call that people are still demanding change. I don’t think it is ideological, I don’t think it is left versus right. I think it is outsider versus insider. It is the new way versus people doing it the old way. That is still the carryover from 2008. And whether the Obama administration recognizes that is important. This is a wake up call that they can’t play the inside game.”
Glenn Greenwald weighs in on the establishment’s effort to reframe Coakley’s defeat as voter repudiation of the Left:
The very idea that an administration run by Barack Obama and Rahm Emanuel and staffed with centrists, Wall Street mavens, and former Bush officials — and a Congress beholden to Blue Dogs and Lieberdems — has been captive “to the Left” is so patently false that everyone should be too embarrassed to utter it. For better or worse, the Democratic strategy has long been and still is to steer clear of their leftist base and instead govern as “pragmatists” and centrists — which means keeping the permanent Washington factions pleased. That strategy may or not be politically shrewd, but it is just a fact that the dreaded “Left” has gotten very little of what it wanted the entire year.
Senator John Kerry — the quintessential Washington ‘insider’ — has wisely calculated the necessity in addressing populist angst, by attributing it to Coakley’s defeat:
I didn’t need any reminders, but this election encapsulated what was clear in 2006 and 2008 and remains clear today: Americans are angry. They’re mad at Washington and they’re mad at Wall Street. They’ve seen millions of jobs lost and been left no choice but to bail out those responsible. They’re tired of insurance companies that charge exorbitant premiums but don’t deliver decent coverage when they need it. They’re fed up with sending billions of dollars a day overseas for foreign oil. They hate knowing that they pay taxes while powerful interests evade taxes and hide money overseas in Cayman Island bank accounts. And they expect all of us, Democrat or Republican, to fight for them.
So what should those on the Left take away from these dueling-message efforts? In the future, if Progressives intend to send a ‘resounding’ message by abandoning Democratic candidates, they’d be well served to at least hire an independent polling company to conduct exit polls that accurately quantify the “why?” for voter behavior.
If exit polls aren’t there to capture the true underlying motivation of the voters, then the beltway establishment will gladly define it for them.
Thanks to cbsunglass at FireDogLake for pointing out a newly released Research 2000 Massachusetts Poll.
Though not an exit poll, it reveals exactly what we hoped to show. Fascinating how this has been largely overlooked by much of the press all day.
Here are some of the findings of that poll:
- 95% of voters said the economy was important or very important when it came to deciding their vote.
- 53% of Obama voters who voted for Brown and 56% of Obama voters who did not vote in the Massachusetts election said that Democrats enacting tighter restrictions on Wall Street would make them more likely to vote Democratic in the 2010 elections.
- 51% of voters who voted for Obama in 2008 but Brown in 2010 said that Democratic policies were doing more to help Wall Street than Main Street.
- Nearly half (49%) of Obama voters who voted for Brown support the Senate health care bill or think it does not go far enough. Only 11% think the legislation goes too far.
Watch: White House Economic Adviser Evades Questions On Banks’ Fleecing Of American Taxpayers
This is a must watch interview.
Dylan Ratigan who hosts MSNBC’s “Morning Meeting” is one of the best journalists in the field, because he’s one of the few who really knows the issues intimately, and who relentlessly takes Politicians to task for coming on and spinning with disingenuous talking points. If we had a dozen Dylan Ratigans during the run-up to the invasion of Iraq, I doubt the public would have ever gotten on board with the neo-cons.
Christina Romer, chair of the White House Council of Economic Advisers, came on “Morning Meeting” hoping to paint a positive picture of the newly released economic numbers. But then Ratigan exposes the reality behind the dire small business lending numbers. He reveals how banks have taken the taxpayer money — given to them by the Treasury to stimulate the credit markets — and have hoarded it.
He outlines how they received these trillions of dollars at an ultra-low interest rate — ZERO PERCENT! — and instead of lending it out to businesses, they just purchased Treasury bonds from the government (essentially lending the money back to the government), while charging the government (i.e. the taxpayer) the going interest rate. He points out that this spread has given the banks their new obscene profits, which they now are using to reward themselves with obscene bonuses — essentially pocketing the taxpayer’s money, while refusing to lend it out.
Ratigan asks Romer whether there’s been any discussion in the White House on the windfall profits tax (a higher tax rate on profits that ensue from a sudden windfall gain to a particular company or industry), and points out that this is the exact type of situation this windfall profits tax was created for.
Romer immediately tries to spin away from this dialogue, but Ratigan won’t let her — he pulls her back in. You gotta see this:
The Redistribution of Wealth In America Continues …
The fleecing of the American Taxpayer continues unabated (as reported by Bloomberg): Goldman Sachs Group Inc., Morgan Stanley and JPMorgan Chase & Co.’s investment bank, survivors of the worst financial crisis since the Great Depression, are set to pay record bonuses this year. The firms — the three biggest banks to exit the Troubled Asset […]
Why Obama’s Policies Put Wall Street’s Interests Ahead Of Main Street’s
Dan Froomkin at Huffington Post connects the dots: Many of [Obama’s] chief financial advisers have pocketed extraordinary amount of money from banks and Wall Street, and presumably intend to do so again. They are part of the banker class, and their loyalties have been bought and paid for. Examples? Obama’s top economic adviser, Larry Summers: […]