President Obama's audacious economic address at Georgetown University today provided the last swing of the wrecking ball for the shattered remnants of free market fundamentalism. Even as dazed and disoriented members of the GOP stumble around the ruins in a state of cataleptic shock, mumbling over and over to themselves the consolatory phrase that Obama is a socialist, the president doesn't simply want to tinker with the economy; he's aiming to lay an entire new foundation over the shards of the failed one. His talk laid out a comprehensive program for what might be called the four R's: reform, regulation, restructuring, and revival.
Obama quite rightly spread the blame for the crisis evenly: "This recession was not caused by a normal downturn in the business cycle. It was caused by a perfect storm of irresponsibility and poor decision-making that stretched from Wall Street to Washington to Main Street." Resorting to his favorite "some" gambit, he sought to debunk the naysayers who argue that his deficit spending will trigger hyperinflation. Spend now, Obama indicated, or pay for failing to do so later when the economy implodes completely.
But perhaps the most sobering part of his address wasn't his appraisal of the current state of the economy but what might loom in coming decades as the greatest danger America confronts -- being outpaced by foreign competitors.
Obama didn't make the connection directly, but the blunt fact is that investing in education and health care can help ensure that America is able to compete a decade from now with China, India and other countries that are trying to steal an economic march on it. In my view, Obama is clearly very worried -- and correct to be worrying -- about America's ability, after decades of self-indulgent profligacy, to remain an economic superpower. A crumbling education system and a patchwork health care system is a poor foundation for maintaining, let alone strengthening, American economic might. As Obama put it, "If we don't invest now in renewable energy or a skilled workforce or a more affordable health care system, this economy simply won't grow at the pace it needs to in two or five or ten years down the road. If we don't lay this new foundation, it won't be long before we are right back where we are today."
Obama is cranking high voltage to jump start the shift toward a new American economy. The program he announced at Georgetown should get some sparks flying. Now his administration and Congress have to implement it.