Following up on my post below (and the critical phase we’re entering in January 2009), here’s a question I’m going to be thinking about over the holidays: what are the factions?
We’re going to hear a lot of pablum about how we’re beyond left and right or how ‘liberal’ and ‘conservative’ are outdated constructs. But that’s not what I’m talking about. What I mean is that the critical public policy questions we face post-2008 are different enough from those from earlier in this decade and back into the 1990s that the ways we divided up the players in the public square isn’t really that helpful in figuring out what’s happening or even who we should be supporting.
Let’s start with everything from the mid-point of the political spectrum left, or rather the whole ‘center’ and go left.
What are the factions or groups and what are they pushing for?
And please note that the following is offered in the mod of thinking aloud, less an effort to say anything definitively than to jump start the conversation.
It’s seems almost impossible to find anyone who doesn’t support vast amounts of near-term (say, two year horizon) stimulus (let’s peg ‘vast’ at $500 billion and up) until you get very far to the right end of the ideological spectrum. You’ve got political opportunists like John Boehner and Eric Cantor posturing about spending. But I think this is largely a distraction from where even most political people are. (And Republicans are at least a bit wrong-footed in this effort by the massive amounts of government spending their prime business supporters are currently begging for.) You’ve also got a debate about whether to have stimulus in the form of spending or taxes. But again, at least in broad strokes, I don’t see a lot of people seriously arguing for making tax cuts a big part of the equation.
So in terms of the center and the left, the key points are that the usual forces you’d expect to stand against these sorts of policies (Blue Dog Dems, Rubinite economics types, deficit hawks, etc.) have withdrawn their objections and agree that deficit spending and expansion of government expenditure (to the extent it crowds out private sector investment) are not significant concerns over the one to two year time horizon, given the extremity of the financial crisis.
But let’s break it down from there. What comes next? What Krugman points to in his Tuesday column is that within that broad, apparent consensus you’ve got a lot of people who think you spend like crazy to nurse the economy through the storm and then you go back to the status quo ante. As he puts it …
Right now everyone is talking about, say, two years of economic stimulus — which makes sense as a planning horizon. Too much of the economic commentary I’ve been reading seems to assume, however, that that’s really all we’ll need — that once a burst of deficit spending turns the economy around we can quickly go back to business as usual.
In fact, however, things can’t just go back to the way they were before the current crisis. And I hope the Obama people understand that.
So that’s one potential division, considering the center and left. Let’s call that the division between those favoring a Keynesian Holiday followed by a return to the same broad economic principles we’ve been following for ten to thirty years and those who believe that a brief period of massive government spending will have to prepare the way for thoroughgoing changes in national economic policy. In the latter case, perhaps a scale of reform on par with the New Deal, if not the policy prescriptions or precise ideological flavor of the Roosevelt administration.
Next there’s a cross-cutting division, though perhaps it’s also a matter of emphasis.
There’s a general but pretty vague sentiment that a lot of this new spending needs to go into infrastructure and research and development to move toward a green energy economy. But is that really an essential part of the equation for economic and/or environmental reasons? Or is it just something that would be nice to do a bit of as long as you’re spending a trillion-plus dollars? That seems like another potential cleavage, though I think almost everyone is being so vague about particulars that it’s hard to know where to draw the key dividing lines.
And then a few couple more points. I was talking to David Kurtz a few moments ago and he points out that another potential division, though one that shadows the others, is the question of order and precedence. What comes first? Does mass transit come first? Roads for cars? Green R&D? etc.
And finally there do seem to be some Republicans left. How do they fit in? Or, more interestingly, how do they break down? In a climate of super-high energy prices, there seemed to be a decent-sized constituency on the right for alternative energy sources to cut our reliance on foreign oil. And not all of them thought you could do that by drilling in the US, notwithstanding how many ‘wingers seemed to get inappropriately jazzed by hearing a fetching Sarah Palin yelling “Drill, Baby, Drill.”
Those are some initial thoughts on how to think of the main political grouping 2009 and going forward. Let me know your thoughts. As a reporter and an editor and someone who cares a lot about this country, this is a question I’m eager to get my head around.
Earlier I flagged the AP article about the environmental activist who snuck into a Bureau of Land Management auction and managed to marginally jack up the give-away prices a bunch of oil and gas companies were going to pay to lease the land. Now it turns out, according to one of our readers, that the ‘scam’ was only possible because the Bush administration did the whole thing on a rush basis in order to get as much of the public domain given away to energy industry cronies before January 20th …
The fuss over DeChristopher stems from his disruption of a last-minute push by the Bush administration to give away public lands for a pittance. That’s apparently why the rules were changed for this auction, waiving the time-consuming prequalification procedures that would ordinarily have prevented a stunt like this. As one former BLM director put it: “It was rush before the door slams behind them: ‘Let’s get as many leases out as possible.'”
But what I really love about the story is the complaint that DeChristopher “tainted the entire auction,” by running up prices by thousands of dollars on all the lots he didn’t actually win. Honestly, I don’t understand that. How could bidders have overpaid? They knew what they were buying, and presumably, they wouldn’t have been willing to bid
more than they felt the parcels were worth. So the complaint is that DeChristopher’s intervention narrowed the spread between the value of the rights and their price at auction. I understand why the bidders are angry, but shouldn’t BLM be pleased?Auctions work on the theory that open bidding will efficiently yield the highest price any bidder is willing to pay. DeChristopher’s stunt suggests that, for whatever reason, that’s often not the case at BLM auctions. It turns out that, when pressed, most bidders are willing to pay more, often much more. In other words, DeChristopher exposed the
fact that we’re routinely selling the rights to public land for less than its actual market value. No wonder BLM is mad.
Only a month before the raid on the public domain comes to a close.
At least for the moment.
From TPM Reader JM:
A a reader from Illinois, I consider it appropriate to try to influence the judges of the Golden Duke Awards.
Sarah Palin’s “Bridge to Nowhere” nomination in the category of Best Election Year Fib is certainly appropriate. But her second nomination for General Lying throughout the campaign is dangerous; if you give one Republican a prize for overall disregard for truth, they’ll all want one.
May I suggest, instead,.a special category for Sarah Palin? Many organizations provide special recognition to beginners. A bowling league once presented me with a plaster trophy for Most Improved Beginning Bowler. Something similar, like “Best Lying Newcomer to National Politics,” would narrowly honor The Barracuda for her dishonesty without causing resentment among veteran competitors.
Such an award would benefit Governor Palin and the American people alike, encouraging her to renew a quest for national office that would provide the nation with entertainment for years to come.
(ed.note: Kurtz’s snark is even better: “Nero: Fiddling Was ‘Right Approach'”)
From the Post …
Taking a swipe at the shifting response of the Treasury and Fed in addressing the financial crisis, he said: “When these gale-force winds hit our markets, there were panicked cries to change any and every rule of the marketplace: ‘Let’s try this. Let’s try that.’ What was needed was a steady hand.”
Cox said the biggest mistake of his tenure was agreeing in September to an extraordinary three-week ban on short selling of financial company stocks. But in publicly acknowledging for the first time that this ban was not productive, Cox said he had been under intense pressure from Treasury Secretary Henry M. Paulson Jr. and Fed Chairman Ben S. Bernanke to take this action and did so reluctantly. They “were of the view that if we did not act and act at that instant, these financial institutions could fail as a result and there would be nothing left to save,” Cox said.
Although Cox speaks of staying calm in the face of financial turmoil, lawmakers across the political spectrum counter that this is actually another way of saying that his agency remained passive during the worst global financial crisis in decades. And they say that Cox’s stewardship before this year — focusing on deregulation as the agency’s staff shrank — laid the groundwork for the meltdown.
Given the extreme economic pessimism that is gripping the country, economists, the markets and just about everyone else, it’s astounding in itself that these jobless numbers can keep exceeding expectations.
From the AP …
An environmental activist tainted an auction of oil and gas drilling leases Friday by bidding up parcels of land by hundreds of thousands of dollars without any intention of paying for them, a federal official said.
The process was thrown into chaos and the bidding halted for a time before the auction was closed, with 116 parcels totaling 148,598 acres having sold for $7.2 million plus fees.
“He’s tainted the entire auction,” said Kent Hoffman, deputy state director for the U.S. Bureau of Land Management in Utah.
Hoffman said buyers will have 10 days to reconsider and withdraw their bids if they think they paid too much.
Tim DeChristopher, a 27-year-old University of Utah economics student, said his plan was to disrupt the auction and he feels he accomplished his goal.
I’m all for transparent processes and this really screws that up. But I can’t help finding this clever and funny, especially since most of the leasing of public lands for energy extraction takes place on an only slightly less than criminal basis.
Back in the 1990s, one of the common refrains about the Clinton administration was that the prospect of a truly historic, game-changing presidency was permanently beyond Clinton’s grasp because of the lack of the kinds of challenges and crises in which really profound change and reform is possible. I was never clear in my mind at the time how much this was a bug in Clinton’s own personal bonnet, or a product of the baby-boomer self-obsession that animated (and, let’s be honest, continues to do so) the Clinton era press corps. But for the purposes of the present discussion, I’m not sure it makes a difference since the general point was true. Be careful what you wish for, of course. Peace and prosperity is far the preferable way to live life. But there’s no escaping the fact that deep institutional change, the kind the country inevitably needs at least every few decades is only possible in times of deep crisis and challenge. And whether or not we were looking for it, we’ve got it.
It’s looking for trouble quoting Tom Friedman in a blog post in anything but a critical matter. But his column this morning is right that the kind of very necessary crisis-coping bailouts we’re talking about are really only about righting the ship. Nothing more. As Krugman argued yesterday, it will be a far different thing getting the country into a mode where we’re not reliant on a constant run of bubbles.
Says Krugman …
Too much of the economic commentary I’ve been reading seems to assume, however, that that’s really all we’ll need — that once a burst of deficit spending turns the economy around we can quickly go back to business as usual.
In fact, however, things can’t just go back to the way they were before the current crisis. And I hope the Obama people understand that.
The prosperity of a few years ago, such as it was — profits were terrific, wages not so much — depended on a huge bubble in housing, which replaced an earlier huge bubble in stocks. And since the housing bubble isn’t coming back, the spending that sustained the economy in the pre-crisis years isn’t coming back either.
To be more specific: the severe housing slump we’re experiencing now will end eventually, but the immense Bush-era housing boom won’t be repeated. Consumers will eventually regain some of their confidence, but they won’t spend the way they did in 2005-2007, when many people were using their houses as ATMs, and the savings rate dropped nearly to zero.
All of which means the first half of 2009 is critical for the future in the country. Because even though the kind of deep change the country needs — retooling of the economy, industrial sector, energy policy, etc. — will take years, the pace and scope will be defined early, when Obama’s clout and political power are at their height.
The Brit Hume farewell video, which aired last night on his final broadcast as anchor of “Special Report” (via Calderone):
Sending more U.S. forces to Afghanistan is an idea whose time has come. The question is whether the time when it could work has already gone.
President-elect Barack Obama, departing President George W. Bush and holdover Defense Secretary Robert Gates have backed a plan to send 20,000 or more troops next year. Those forces must confront an increasingly entrenched Taliban enemy and a population grown hostile to foreign troops after seven years of U.S.-led warfare.
“We may have missed the golden moment there,” said Lawrence Korb, a former Pentagon official who has long advocated an increased U.S. focus on Afghanistan.
The tension between the short-run need for more muscle to thwart the Taliban and the long-term trap of becoming the latest in a long line of foreign intruders bogged down in Afghanistan forms the core of the dilemma confronting Obama.