Saturday 20 November 2010

A View on American Politics from a British Conservative - Secondly, Midterms, President Obama, Democrats and Republicans

It seems incredible that only two years after Barack Obama's meteoric rise in 2008, from barely known junior senator of Illinois to President-elect of the United States by the end of the year, we could be standing here watching Obama described as embattled, rejected by the voters, struggling and watching the Republicans surging back to take control of one half of Congress from the Democrats.  Barack Obama's rise was incredible, both in objective terms, and even more than this, in the sheer enthusiasm with which he was greeted by not only Democrats, not only Americans, but by people around the world.

I have never seen such a wave of public-goodwill to a politician.  After the division of the Bush Years, the War on Terror and the Financial Crisis, the election of an intelligent sounding, liberal, eloquent Black man to the position unofficially known as Leader of the Free World seemed to indicate a new dawn.  To a certain extent this was understandable.  George Bush was not popular round the world, a leader on the American left was always going to be more understandable to Europeans, where the centre of political gravity is considerably further to the left than America in general.  After the battering of the Financial Crisis and the War in Iraq people needed something to believe in.  On the other hand, it was also just ridiculously out of hand.  Neither media nor public seemed to be able to keep things in sensible levels.  By the time he was elected Obama had displayed consummate skill as an electioneering politician, but beyond that no more skills than making pretty speeches and coining particularly vacuous slogans.  Yelling "Change we can believe in" was bad enough, but "Yes, we can!" was taking vacuity to bold new levels, and with the other main theme of his campaign being 'Hope', to say Obama's campaigning was somewhat light on details is like saying Gordon Brown is a bit boring.  It was so successful that is tempted the British Conservatives to try a similar thing for our election earlier this year, though with notably less success.

This is not to say Obama did not have policies: Health Care reform, Economic Stimulus, Climate Chance legislation, finishing the wars in Iraq and Afghanistan were ambitions enough for any politician to cover in 4 years.  But the level of hype was ridiculous.  Obama was being presented as a cross between the 2nd coming of Jesus Christ, Martin Luther King jr, and Abraham Lincoln.  This was a good for Obama at the time, because it meant all he had to do was exploit it, spout cliches, and not do anything too stupid.  Of course it helped that McCain, having started his campaign quite sensibly distancing himself from George Bush, went loopy and started spouting nonsense and somewhat crazed accusations of socialism and goodness knows what else.

The downside of all this though is that whatever Obama did, and he entered office at perhaps the most difficult time for any President since Reagan, he was bound to disappoint on a massive scale, unless he somehow pulled a few trillion dollars, a cure for AIDS, and peaceful solution for Israel-Palestine out his ass in his 1st year.  And, obviously he did not do these things, and so despite having moved heaven and earth as far as one man can over the last 2 years, he finds himself plummeting in the opinion polls and the Democrats on the back foot.  As far as he was not responsible for the hype that accompanied his election and the American political scene over the last few years it is quite unfair this has happened to him.  But to the extent he deliberately built up a wave of hype to surf to successful election he is getting what was coming to him when that wave comes crashing down.  The difference here between the experience over the last few years of the USA and the UK is interesting.  The Conservatives deliberately quite some time playing down expectations before our election, and after it, predicting gloom and doom for precisely the reason they knew there was no magic wand to wave and there has not been the same backlash against them, though there has been against the Liberal Democrats for other reasons.  Though, on the other hand, their election was certainly not greeted by the same outburst of joy as Obama's.

Some of the more enthusiastic and goldfish-brained commentators went beyond hype for Obama.  They did not only regard Obama as the second coming but also forecast, pretty much, the end of the Republicans as a threatening force.  After their loss of Congress in '06, the opprobrium of the end of the Bush years and Obama's massive victory, with the map painted Blue, it seemed that the Republicans were possibly doomed to retreat to a white, elderly hard-south and mid-west rump, unable to reach outside the shrinking white share of the population and even there restricted to relatively unsophisticated, largely poor, conservative,
areas.  Apparently all demographic trends were against them.  There was talk of a 'Liberal moment' for America.  This analysis was simple, seemed at least vaguely supported by events and, crucially, was vastly appealing to certain people.  Unfortunately, for some people, it was also dead wrong.  I remember thinking back in 2008 that it was extremely unlikely, though not outside the realms of possibility.

The problem seems to be that political commentators are not only generally  incapable of keeping a sense of perspective, and not only have a tendency to write in thick cliches, but also have an extreme short term memory problem.  The thing was, I could remember similar predictions being made, in the opposite direction, in 2004.  Then the evidence mustered was equally impressive.  Republicans had won 5 out of the last 7 presidential elections, they had held congress for 10 years, Americans were identifying as more conservative than ever, and the Democrats couldn't even win against as divisive and dubious a figure as George Bush.  America seemed to be moving in the red direction.  I also remembered at about the same time people making the same predictions about the Conservative Party here in 2005.  After 3 elections gaining 31, 32 and 33% of the vote, having failed to decapitate Tony Blair, even after Iraq, it seemed the Conservatives were stuck with their right-wing rhetoric attracting about 1/3 of the vote, unable to reach out to a more liberal, centrist Britain.  By 2008 though these predictions were already outdated, as under David Cameron the Conservatives loomed high over Labour in the polls, even as I contemplated the complete reversal, in only 4 years, of the predictions of Republican hegemony.  Looking a bit further back I knew similar things had been said about Labour after 1992, as they managed to fail to unseat the Conservatives, in seeming perfect circumstances, for the 4th time.  Those predictions were already falsified in dramatic style in 1997.  The other reason I had to be dubious about such predictions, apart from historical precedent, was that I could just about imagine the Republicans fading away if another party rose to replace them, as the Liberals did in Britain, with the rise of Labour in the 1920's.  But under America's stunningly two party system I just could not see it happening, and so I thought that in four years time we would probably see the Republicans back and alive, to give a decent challenge to Obama.

Not even I imagined though that in only 2 years the Republicans would be back, and if not sweeping all before them, then certainly in rude enough health to give Obama a bloody nose.  The answer to this conundrum seems to be simple: The Tea Party, and more broadly the economic malaise that continues to dominate American politics.  For all its weirdness, it is impossible to doubt that the Tea Party gave the Republicans a massive shot in the arm.  After it seemed they would sink from view for a while, trying to shake of the ignominy of the Bush years, the Tea Party roared into view, channeling opposition to Obama and firing up conservative leaning voters, and all without any connection to Bush.  This is not to say that the Tea Party has been an unadulterated success for the Republicans.  There are, perhaps, two very relieved Democrat senators today, who still have their seats because Tea Party activists were incapable of keeping their ideological enthusiasm in check, and selected candidates who were incapable of success where more mainstream Republicans could have succeeded (Cough, witch, cough).  But life isn't perfect, and overall the Republicans would be in a much worse place today politically were it not for the outpouring of enthusiasm the Tea Party produced.

What gave the Tea Party space to flourish though, and gain credibility, was not the Liberal-left, moderately social-democratic approach of president Obama, nor even the divisive health care legislation, though that started things off.  Rather it was the continuing malaise surrounding the American economy, that depressed confidence across the US and fired even relatively centrist, unideological voters away from the Democrats.  The American economy still seems to be in a morass.  Unemployment, in a country with historically lower unemployment than Britain or, God forbid, Europe, remains stubbornly high.  Debt continues to burst through the roof with a deficit measured in the trillions of dollars and with little obvious will to bring it down.  The Federal Reserve has just launched a further huge round of printing money in an attempt to ease credit and get the economy moving.  America seems stuck in a rut it cannot get out of.  And all the while the headlines are dominated by stories of Chinese and Indian success and dynamism, and America's continued seeming lack of an ability to score a decisive victory over a rag-tag of terrorists in Iraq and Afghanistan.  For the first time since the Cold War, America's global dominance seems challenged.  Realistically, its problems are not that bad.  Europe has a history of dealing with worse, and doing it considerably more phlegmatically.

But the fact is that so much of what America is, is just confidence.  That is the thing that marks America out, apart from from the French, its traditional overwhelming confidence; its belief, often justified, that it is the best, it is unique, it is better than anything else in the world.  Not in all my life, which has largely coincided with the period of unique American dominance globally, post cold war, have I seen that overwhelming cultural and economic confidence so battered as it seems at the moment.  It is not just the economic crisis either.  The quagmire in Iraq, the difficulties in Afghanistan, the scandal of Abu Ghraib, the feeling that America is falling behind as the world's most dynamic nation, faced with China's 10% a year growth and seemingly limitless potential, have undermined America's sheer self-belief.

Partially this sense of subconscious self-doubt was the reason Obama was greeted with such jubilation at first.  After the difficulties of the latter Bush years here was a saviour who would put everything to rights.  The fact that he has not done this, despite his seeming best efforts, not to mention trillions of dollars and a huge quantity of arguing, is the underlying reason why the American public seems to have fallen so quickly out of love with him.  There are less fundamental reasons as well of course.  Obama seems to have become as poor a communicator in office as he was a good one when campaigning for it.  Having excelled at poetry his whole administration seems to struggle in prose.  He seems to come across as what he, quite frankly, is, an aloof, well-educated, University professor, a member of the elite and having come down the mountain, now not the best man to seem to communicate with or relate to ordinary, working class Americans in the way Reagan, Clinton or even Bush seemed more able to.  This pales though beside the underlying sense of economic and social stall that America is struggling with.

All these reasons where why the Republicans, despite having no obvious solutions to these problems themselves, benefited so strongly in 2010.  Obama may have made all the right calls, but it doesn't feel like anything has particularly improved in America, and so Obama has received no credit for it.  The stimulus may have stopped America sliding even further into the morass, but a lot of voters don't feel better off from it, so it just seems like several hundred billion dollars spent with no benefit.  Americans hence look around to see what else might be on offer, and thus we get the Republicans surging back in the House, and only avoiding retaking the Senate by the fact its elected in 1/3rds, and is hence almost impossible in one go.  

At this point I should declare my interest in this.  I actually have no particular dog in this mid-term fight.  As a British Conservative I am nominally lined up along side the Republicans, as the fellow conservatives in America, and against the Democrats who are the vaguely liberal-left-ish party on offer.  However, as a British Conservative, which is these days a lot more like being a European conservative than an American one, I support things like a Socialist National Health Service, a strong welfare state, general social liberalism, and a state of such a size as most Republicans would find absolutely anathema.  And on all of which positions are actually well to the 'left' of even the official Democrat program.  On the other hand the Democrats are certainly not perfect either.  They seem to harbour various strange leftist and 'liberal' ideological threads, a closeness to trade unions, a loose fiscal approach that I find somewhat ridiculous.  Also I remember growing up amidst Bill Clinton's troubles with the law, hardly the Democrat party's most shining moment either.  To be honest as far as I can tell, given my own personal political preferences, I would be either, in American terms, a very liberal republican or a very conservative democrat.  Both beasts in considerably greater supply in prior times than today.

Back in 2008 when we had the election I wanted Obama to win, as did most of Europe, and I have generally agreed with what he's done.  The Republican opposition to Obama seems to have been confused and at times descending into the outright bizarre.  Accusations of Socialism, being a Muslim, and a particularly ludicrous conspiracy theory involving Obama's birth certificate, were pushing the boat out in terms of weirdness even for Americans.  Generally the Republicans seemed to largely descend into a confused haze, before picking themselves up somewhat before the Mid-terms, driven, presumably, by the need to look at least vaguely electable at an election time.  In this they seemed to be copying the strategy of Labour in the UK, becoming the party of 'No', opposing actually everything without bothering to ever state what they might do instead.

From my position as a British Conservative: Obama was right to push a cap and trade bill, right to attempt to widen the ludicrous system of American healthcare, right to commit more troops to Afghanistan and right to reach out to the Muslim world.  On a more trivial level he was right to attempt to close Guantanamo Bay, right to speak out in favour of the so-called 'Ground Zero Mosque' and right to criticise Israel over its building policy.  The sign of a great man is that he (at least) attempts great things, rather than just stay in the shallow waters.  And Obama has shown the willing to do this.

On the other hand I also have some sympathy for the worries that the Tea Party raise, and that has motivated that movement, if certainly not with some of its more wacky fringes.  Obama was right to try to widen access to healthcare in the US, from around 80% to 90% of the population and try to end some of its more painful features, such as insurers refusing to touch people who had been already ill.  But it not only does little to bring down the incredible cost of US healthcare, about $4,500 per person, compared to $2000 in the UK and between about $1500-2500 across the rest of the developed world, but it actually will cost a trillion dollars more, and with the absence of the important public option for healthcare provision, was gutted in comparison to the original plans.  Obama hesitated in committing more troops to Afghanistan, he and his administration took an unnecessarily simplistic and jingoistic line over the BP oil spill, he ended the plans for NASA to return men to the moon.

All these are pretty minor quibbles though.  The biggest point where I disagree with the Democrats and agree with the direction the Tea Party argues for it is in terms of the economy.  What marks the British Conservatives out from European conservatives or (mostly) American conservatives, is that we have made true fiscal conservatism, in the form of a detailed program to reduce our deficit and move towards a balanced budget over the next 5 years, the core of the current government, and our platform at the last election.  The US, like Britain, and like the rest of Europe, risks drowning under a sea of debt, both private and most significantly Public, if serious measures are not taken.  We risk piling more and more liabilities onto following generations, at a time when our populations are aging generally, that risk undermining our economic position over the long term.  We especially risk losing the economic initiative to the more disciplined and hard-working emerging powers whether China, India, or others, if we take the easy way out of our current problems rather than facing up to the difficult issues.  And I believe that politically, considering the lack of stability and political maturity that is still so evident outside the western world, this is an extremely dangerous circumstance to be facing.

The American budget deficit is, as a % of GDP, about the same size as the current UK deficit, (10.7%) both of which are pretty much the largest in the world (apart from really screwed countries like Ireland or Greece).  The difference is that whereas the UK government is focusing on bringing this figure down over the medium term, and has committed to taking some pretty difficult decisions to make it happen, the US government seems to have no such plan.  Obama seems to be committing himself to some ultra-Keynesian effort, entirely relying on a $800 billion fiscal stimulus, quantitative easing and America's pre-eminent economic position to bring the deficit down.  This just will not work though.  Stimulus on its own is not a painless solution.  Too much of the money gets lost, especially in America's leaky political system, with its pork-spending, earmarks and bridges to nowhere.  It will help to get America over the worst of the rut, but on its own is not a fiscal solution, that requires real hard decisions to restore America's fiscal credibility.  

This is not to say the Republicans have really done any better.  They started the deficit off, turning Bill Clinton's surplus into an impressive deficit even before the recession hit.  Bush signed off his own bizarre stimulus bill, to prop up, at massive public expense, America's car industry.  They have opposed the repealing of parts of the Bush tax cuts, as well as any serious spending cuts except in totemic areas like Obamacare or Obama's own stimulus, and are seemingly committed to their own bizarre Keynesian myth, that just cutting taxes enough will magically produce enough economic activity to cut the deficit, and over-ride the money lost by cutting taxes in the first place.  Now, when taken sensibly this is a perfectly economically reasonable substitution effect, famously known as the Laffer curve, and like a fiscal stimulus is a real effect.  When taxes are cut, more or less depending on the tax, economic activity will rise and thus also (relatively) revenue, going some of the way to cover the money lost by the initial cut.  Just like a stimulus though this alone is not nearly enough to cover the money lost, especially something as vast and varied as the US economy.  The US fiscal problems, like the UK's, is a deep seated structural problem and simplistic solutions, whether involving widening the deficit by boosting spending, or widening the deficit by cutting taxes, is just not going to do the job.

Only from the Tea Party has any outspoken voices coming actually suggesting that seriously cutting US spending may be necessary to get debt down and hopefully balance the books.  Or even that balancing the books should be a political priority over the next few years.  To Obama's credit he has planned to reverse the Bush tax cuts, undoubtedly a necessary step.  But he has seemed to express even less political willing than the Republicans to actually cut spending, or show particular leadership on this issue.  It is not his fault.  No-one in American politics seems particularly willing to face up to this issue, but he certainly does not seem to be leading the field.

To compare the situation to plans laid out by the Conservative-led Coalition government here.  Here the government has prioritised deficit reduction.  This has meant a measured program of tax rises, to the tune of £29 billion, or 2% of GDP, as well as a program of spending cuts over the next 4 years of £81 billion, or 5.8% of GDP.  The equivalent figures for America would be about $290 billion of tax rises and about $810 billion of spending cuts.  Also these measures have been spread widely across the population and across government spending.  Apart from state healthcare and International Aid, we have seen tax rises on the rich and on everyone else, and spending cuts across government departments, including education and defence, as well as significant cuts on welfare and spending on capital projects.  All these are necessary together if one is really serious about fiscal conservatism and restoring fiscal stability and almost no-one on in America seems willing to face up to these facts.

If anyone was really serious about restoring fiscal balance in America there are a number of clear opportunities.  Increasing taxes for a start, especially the efforts to repeal the Bush tax cuts that Obama is already intending.  Cutting social security, especially for the elderly, and cutting the military.  A good clean 10% cut on bloated defence spending would go a considerable way to solving America's budget problems, netting some $90 billion a year.  Chopping pensions back would help as well, as would ending the political culture of earmarks and pork and local bribes attached to every single government bill.  Real reform of healthcare would be essential as well.  Obamacare goes a little bit of the way, but US healthcare is still horrendously expensive.  And even though Obama's measure don't shift healthcare onto the government in anything like the way the NHS does in the UK, the US government still almost manages to spend the same amount as a % of GDP and it is arguable if Obamacare will bring this down at all.

Basically were I an American citizen I would feel honour bound to seek out my local candidates and try to vote on the grounds of which appeared saner on the above criteria.  These obviously cut across party lines to a certain degree.  I agree with most of the democrat platform on most policy issues, but I am naturally more fiscally conservative than either of the main party lines over recent periods.  A particularly fiscally conservative democrat would be perfect, a more reasonable, moderate fiscally conservative republican would do as well.  It would come down to the people involved, as it perhaps should in such elections.

How I would have voted if I had a vote is pretty irrelevant though.  The result of the election was clear, Republicans majorly up, Democrats majorly down, and I can draw a few points from it.  America seems to have, at the moment, a political atmosphere based considerably on a sense of dissatisfaction with the way things have been going, a wave of enthusiasm that seems to wash dramatically over the more prosaic policy disputes that actually exist beneath it.  I have mentioned before how the importance of confidence to America and this is something that seems to pervade American political life.  In both 2008 and 2010 American politics seemed to be motivated by, primarily, an anti-politician mood.  A feeling that the government is not working, that something is not working with America, in a manner that is almost not entirely conscious or consciously framed, but is real none-the-less.  In 2006 and 2008 this anti-establishment, anti-politician mood hit the Republicans, sweeping them from office, in 2010 it was now the Democrats turn to be the people in office, swept away under a tide of anti-government rhetoric.  In either case though it seems to be the same troubled mood that is underlies both.  In 2008 Obama was able to ride that wave to victory, posing as the quintessential outsider, totally different to the current administration.  Now Obama's Democrats are the ones battered by a wave of expectations, and falling victim to people playing the role of simple-talking common sense.

In a way, if I may be slightly rude, this seems a somewhat delusional atmosphere.  Americans feel that the world is changing and is slipping away from them but they don't yet seem entirely willing to face up to the harsh truths that means, whether higher taxes, lower spending, more expensive oil, or the fact their politicians cannot wave a magical wand and it make these issues go away.  On the other hand though, their politicians have to take a lot of the blame.  It is their job to provide leadership, it is their job to stand up and say the difficult things, whether people want to hear them or not.  That is the mark of a decent politician.  If politicians will offer simplistic solutions, telling their electorates they can achieve a balanced budget by cutting taxes, or by raising spending, then it is no surprise their electorate begins expecting magic solutions, and complaining when any pain comes along.  Even still, though, it seems that the American people somehow fundamentally know that something is wrong.  The consistently, shockingly low approval ratings for Congress point to it, the plunging of Obama's own approval ratings, the stunning low of Bush's before him, the emergence of the Tea Party outside the formal party structure, all point to the fact that the American people fundamentally feel something is deeply wrong with business as usual.  In elements of the Tea Party we have perhaps the start of the process of facing up to some difficult truths.  In President Obama's health care reforms we have a step in the right direction in another area, that an area of America's current social model might not in fact be the best choice, not just in terms of tinkering round the edges, but in terms of its fundamental structure.  And quite frankly, this is a good thing for any country, not just America, to face up to every now and again.

This is certainly not the end of the road for Obama though, not anything like it.  As said elsewhere, a split congress may actually help.  Now neither Republicans or Democrats can exclusively drape themselves with the colours of the outsiders, though they will both undoubtedly still try.  Republicans have power, but certainly not control, and a smart play by Obama can force them to play along, to a degree, and thus share some of the blame and credit rather than carping from the sidelines.  A congress and government with shared responsibility may improve Bi-partisan relations, at least in practical terms, if not in terms of rhetoric, as one side can no longer take the role of just trying to valiantly oppose everything.  Not being in a position of dominance, or eternal opposition is good for politicians.  It forces them to actually come up with new ideas and try to push new solutions, rather than just rehashing the same old chants and cliches.

Also, Obama is not a Prime Minister and is not facing a legislative general election in 2012, on which his re-election depends.  He is a President and as such he is only up against that particular other person whom the Republicans will scrape together to face him.  At this point he will be able to play to his strengths, and that Republican will very much have to present a better alternative.  George Bush did not exactly have positive qualities oozing from every pore on his skin, but he won because his Democrat alternative managed to be even less credible and inspiring, and offered no coherent positive alternative for the voters to rally.  Chances of Republican victory in 2012 rely on them finding a candidate that seems both competent, reasonable (if not outright moderate) but can still fire up conservative voters and carry at least the partial blessing of the insurgent Tea Party movement.  If they can get all these things together, and reconcile the contradictions inherit therein, they have a good chance of beating Obama, something that would have seem laughable only 2 years ago, when the general assumption seemed to be that Obama would cruise to a 2nd term without serious trouble.  It may still not be enough, but they would at least have a fighting chance, whereas if they pick a candidate that lacks the ability to inspire America, at least a little, and appears credible, to both their conservative base and moderate, centrist, independents, then Obama can sleep easy, knowing his re-election is almost assured.  To be quite blunt, without a credible candidate they will lose.  


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