Why We Got Ayn Rand Instead of FDR: Thomas Frank on How Tea Party 'Populism' Derailed a New New Deal
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Santelli’s rant caught the insurrectionary spirit of the times. Public choler at the powerful was blowing out the stops in those first few months of 2009, and the reporter’s outburst was an immediate sensation, replayed millions of times by the angry YouTubing multitude. The instant comparison was to Howard Beale, the populist anchorman character in the 1976 movie Network, raging against the system while the cameras rolled.
That the broadcaster was, in point of fact, speaking on behalf of the system and against the claims of the average people who were its victims was a subtlety Americans found easy to overlook. It was a time of confusion, and just about wherever you looked, the frustrated expressions of the powerful were being characterized as spontaneous eruptions of the American everyman, taking matters into his own hands.
Conditions were right for grand-scale perplexity of this kind. Who knew, for example, what a credit default swap was? And who could explain the process by which such an instrument had brought the mightiest economy on earth to a standstill?
Amid the tides of bewilderment, though, one piece of deviltry stood solid and unmoving, a sort of Gibraltar of populist outrage: the TARP bailout bill. Now, here was a villainy people could understand. It would be costlier, Americans were told, than the entire Vietnam War, or the Louisiana Purchase, or just about anything else. And it was unmistakably bad: the bailouts were the avenues by which our government obligingly moved the financial industry’s losings over to the taxpayers.
In different times, TARP might have become the rallying point of a revitalized Left. After all, the bailouts were clearly of a piece with the misbehavior that had come before: the deregulation of the banks, the bonus culture, the wrecking of the supervisory state. Business-friendly conservatives had been behind each of these, and then business-friendly conservatives had knitted together the TARP for the same rotten reason: to give the bankers what ever they wanted. Reformers might have depicted the TARP as the final chapter in the great book of fraud, the episode in which Wall Street used the captured state to transfer its debts to the public.
But it was the Right that grabbed the opportunity to define the debate, using bailouts to shift the burden of villainy from Wall Street to government. For them, the TARP was the only part of the crisis story that mattered— not the derivatives or the deregulation— and its conservative-Republican parentage made no difference. (That congressional Democrats voted for it, on the other hand, was deeply meaningful.) They were the sole rightful opponents of the TARP, conservatives insisted, because they opposed federal interventions in the market, and bailouts violated strict laissez-faire orthodoxy— their orthodoxy. Bailouts allowed government to decide who won and lost; they replaced the forces of competition with those of administrative fiat; and they puffed up the deficit, to boot. And so the Right staked its claim, making the TARP into the outrage that lifted a thousand snake flags.
“Let the Failures Fail”
The first of those snake flags was hoisted at a Tea Party rally in Washington eight days after the Santelli broadcast, and it was as perfect an example as any of the Right’s ability to capitalize on public confusion. That original Tea Party rally sure didn’t look spontaneous or grassroots to me when I showed up. In fact, it had every appearance of being one of those staged protests that happen all the time in Washington, in which a handful of people from a pressure group pose with signs for the media. I had heard about the plans for the gathering not from some radical handbill picked up on a street corner, but in an online message from an editor at the American Spectator, a sturdy pillar of right-wing Washington. The rally was to be held at the park across the street from the White House, the traditional staging ground for phony right-wing protest going back (at least) to the days when Jack Abramoff ran the College Republicans.