05/19/2010 12:20 pm ET | Updated May 25, 2011

Change, Not Recovery

What was the message of Tuesday's elections? Clearly the base voters of both parties are unhappy and looking for change. Incumbents are at risk. Politics as usual is unappealing.

Conservatives in both parties are spinning this as a protest vote about deficits and spending. But voters are angry not because of abstract deficits. They are angry because the record deficits come as Wall Street was bailed out and jobs are still scarce. Independent voters rail about spending, but their anger is less about size of government than about competence and corruption, a government suborned by special interests that doesn't work for them.

Last week, President Obama went to Buffalo to talk about the economy. Hailing the 290,000 jobs produced last month, he essentially declared victory:

"We can say beyond a shadow of a doubt today we are headed in the right direction. All those tough steps we took, they're working, despite all the naysayers who were predicting failure a year ago."

While the president made a ritual bow to Americans who are still hurting -- "I won't stand here and say we've climbed all the way out of the hole," and called on the Congress to take action on jobs, he wanted some credit:

"Last month we had the strongest job growth we had seen in year ... [T]his month was better than last month. Next month is going to be stronger than this month. And next year is going to be better than this year."

This is truly wrongheaded. Yes, economists are declaring the economy in recovery, and last month's jobs increase was a relief. But nearly 25 million people are unemployed or underemployed. There is no recovery until people are back to work.

Worse, the celebration of "recovery" ignores the core of the president's own change agenda. As he said, we can't "recover' the old economy and we should not want to. It was based on bubbles and debt and stagnant incomes, hemorrhaging good jobs, while creating Gilded Age inequality and a declining middle class -- even when it was supposedly enjoying the "great moderation."

Instead, as the president said, we have to build a new economy out of the ruins of the old. He laid out many of the elements. Clean up government and make it serve the common good rather than special interests. Stop squandering resources in Iraq and invest in areas vital to our future -- education and training, 21st century infrastructure, research and development. Curb Wall Street's casino that was capturing 40 percent of all corporate profits at its height. Capture a leading role in the green industrial revolution, creating jobs while moving aggressively to renewable energy. Balance our trade globally, ending the $2 billion a day deficits that we borrowed from abroad. Make health care and education more affordable, providing greater security and opportunity to all. Empower workers to gain a fair share of rising productivity, and rebuild America's middle class.

This isn't a sound bite. It's not as simple as the conservative mantra of "cut taxes, cut spending." It requires an activist government, not a weak one. And it represents a profound and necessary change of course.

Now, however, the president seems to be applauding a recovery that is drifting back to the old order. The stock market is back, but mass unemployment continues. Wall Street has reopened the casino and is racking up record profits. The trade deficit is back over $1 billion a day and rising. Rising costs of war abroad and a hard freeze on domestic spending block any serious domestic investment agenda. The Congress is gearing up to pass a $32 billion supplemental for the war in Afghanistan while declaring that spending $23 billion to stop projected layoffs of 300,000 teachers in the next year is unaffordable.

What happened? Not surprisingly, the Obama agenda ran into great resistance. In some cases, the wounds were self-inflicted -- as when the banks were rescued but not restructured -- a costly political and economic mistake. On recovery, health care, financial reform and energy, entrenched corporate interests mobilized, buying votes in both parties to protect their privileges. Republicans chose purblind obstruction as their political strategy. The right galvanized an angry reaction, subsidized by corporations, engaging the wing nut right railing against "socialism" or "fascism."

The "recovery" takes us down a road of no return. The right has no answer, simply repackaging the same market fundamentalism that proved dangerous to our economic health.

It is time for the progressive movements that challenged Bush, gave Democrats their voice on Iraq, and mobilized in large numbers to take back the Congress and elect Obama to rally again. We will have to expose and challenge the corporate lobbies that stand in the way. We'll have to mobilize people to counter the influence of corporate money in politics, particularly after Citizens United. We will have to hold politicians in both parties accountable. We'll have to build pressure that can change the balance of forces in Washington, challenging the caution of the White House. And we'll have to do a far better job of rallying Americans to drive the change we need.

(At America's Future Now, the annual gathering of progressives in Washington DC on June 7-9, progressive leaders and activists will map out the ideas and strategies vital to this effort [full disclosure: the conference is sponsored by the Campaign for America's Future, which I co-direct]

Tuesday's elections show Americans are still looking for change. They are casting protest votes in both parties. But the real battle about direction has only just begun. On the right, Republicans increasingly are dominated by a reborn conservatism, proclaiming a market fundamentalism that has been tried and failed. The question is whether a progressive majority can be forged to drive the change needed to make for a more perfect union.