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Beyond Gotcha: In Search of Democratic Economics

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In the aftermath of the now famous "bitter" remarks by Presidential candidate Barack Obama, an observer of the Democratic primary season might have hoped for a renewed interest in proposals for making the US economy work better and fairer for working class and middle income Americans. Unfortunately, media interest remains focused on the trivial. The Huffington Post rightly called this week's Philadelphia debate moderated by ABC "The Gotcha Debate". Neither Obama nor Clinton seems able to rise above the din and remind voters of what is actually at stake in this election. John McCain did weigh in on April 15 with his most detailed economic speech --and it will have to serve as an indicator of what matters.

It is the economy, stupid-- once again. Too bad that McCain is not the maverick in domestic policy that he claims to be. His prescription is little more than rehashed Reaganomics -- tax cuts, and insufficient or nonexistent regulation, cloaked in lukewarm populist language. As the New York Times economics columnist David Leonhardt notes, incomes for middle income families in the US have remained stagnant for the entire Bush Presidency. Coupled with the threat of losing health care benefits and declining or absent pensions, facts on the ground underscore the growing economic anxiety and "bitterness" felt by many American workers and their families.Voters are looking to the Democratic candidates to speak to their economic insecurity and to their financial futures. The time is ripe for some kind of new New Deal -- but where will it come from?

What is needed are both compelling language and a serious reform program.

My closest friends and colleagues know that I feel a bit jaded about such calls for progressive campaign programs. I have been through this before, and had my hopes dashed or at least severely tempered by political reality.

In 1983, I co-authored a book optimistically titled A New Social Contract: The Economy and Government After Reagan. The book analyzed the appeal and contradictions of Reaganomics and proposed a detailed Democratic alternative that we labeled a "new social contract." I worked as an advisor on Gary Hart's unsuccessful primary campaigns trying to promote these ideas, and then supported Mondale and Dukakis. Instead of a new social contract, we first got four more years of Reagan, and then four years of the George Bush Presidency, and more Reaganomics.

I had a bit more luck during the 1992 campaign when I was a senior advisor to Bill Clinton, and co-authored the campaign program Putting People First. It was, admittedly, a compromise document, but many progressive policy proposals were contained in it. During the campaign, the Wall Street Journal criticized me in a front page article and in subsequent opinion pieces as "The Liberal On the Clinton Bus ". Partly because of these attacks, President-elect Clinton chose not to include me in his economics team, and like my mentor John Kenneth Galbraith, I got sent abroad as an ambassador. The story of the Clinton administration's political inability to pursue a significant reform agenda is well known -- and is recounted in John F. Harris' book, The Survivor: Bill Clinton in the White House, and in Clinton: The President They Deserve by Martin Walker.

After almost eight years of Bush's neo-conservative foreign policy and warmed over Reaganomics, one doesn't want to be too cynical. The damage to the country at home and abroad has been serious and requires much repair. I like to think that I am a political realist, and that I understand what kind of political reforms are genuinely needed (see the Huffington Post article, Change That Really Matters). The economic reforms that would bring a more equal and fairer economy have not changed too much from what was proposed in A New Social Contract or what Robert Reich, Ira Magaziner and I and a few others wrote in Putting People First back in 1992. What is needed are political vision and political skill, as well as a mobilized base of support for real change.

I wish that Barack Obama had read our work -- or that Mark Penn, the lately departed campaign consultant for Senator Clinton's campaign, had consulted them before deciding on his primary strategy. Neither campaign has produced anything close to the far reaching reforms offered to the public in Putting People First.

I don't expect Presidential candidates to endorse any one set of progressive reforms --but I would like to hear the Democratic candidates talking about an Economic Bill of Rights for the 21st Century, not just technocratic neo-liberal policies or cant about changing the atmosphere in Washington, DC and bringing us together.

Blame does not fall only on the candidates and the media's Gotcha game. The major labor unions have split their endorsements between Clinton and Obama, focusing time and money on the primary states rather than on promoting a new economic program for the party and the country. Progressive groups such as MoveOn.Org have endorsed candidates and mobilized members around the primaries while neglecting to engage them in a debate on what economic and social reforms the next president and administration might advocate.

The Democratic Party needs to remember its own history.

In his 1944 State of Union message, FDR told the nation:

"We have come to a clear realization of the fact that true individual freedom cannot exist without economic security...

"We have accepted, so to speak a second bill of rights under which a new basis of security and prosperity can be established for all, regardless of station, race or creed..."

Roosevelt went on to enumerate such economic rights as the right to a decent home, to adequate health care, to a job, and to a fair and competitive economy. His speech was based on research done by the National Resources Planning Board headed by economist Gardiner Means. FDR did not live to see his commitment to an Economic Bill of Rights enacted into law. . The progressive programs that he and his Democratic successors Truman, Kennedy and Johnson did pass were attacked by the Reagan administration, and many aspects of the social contract between labor and capital and between citizens and their government were weakened or torn to shreds. Both Bush administrations continued these assaults on the programs and policies that served as the foundation of the New Deal and the Great Society -- and the first Clinton interim did little to rebuild them or to construct a new political economic strategy for Democrats.

The era of globalization ushered in at the end of the Cold War requires a new social contract -- at home and abroad -- if America is to rebuild and to prosper as a democratic society.

It is no surprise that a huge majority of the American people believe the country is on the wrong track. They are looking to the Democratic Party both to rebuild our economic foundations, and to provide a policy road map for the 21st century. Are the party and its leadership, as well as party activists, up to the challenge?

One way to jump start the process would be for the Democratic Congress to pass a sense of the House and Senate resolution calling for an Economic Bill of Rights (The 1983 draft of such a resolution in A New Social Contract is available to be copied or updated.) At the Democratic National Convention in Denver this summer, the party should call for the next President to introduce economic and social policies that would make such an Economic Bill of Rights a reality for all Americans. And the party's Presidential candidate should pledge him or herself to making this the overriding domestic priority of the next Democratic administration. The party, its candidates and its leading grassroots groups should pledge to support the Economic Bill of Rights and aggressively campaign on it in the fall. In this way, we might have a serious debate about economic philosophy and the chance of enacting change that improved people's lives as the New Deal and the Great Society did in years past.

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