Is Obama’s Fiery New Populism Phony or Heartfelt?


Whenever President Obama starts talking like a populist, as he did in his recent speech condemning income inequality, people start wondering if they are hearing conviction or calculation. 

Could he be inspired by the success of bold progressive voices like Sen. Elizabeth Warren, or the recent elections of populist-minded candidates to mayorships in both New York City and Boston? Might he be listening to the American people, who overwhelmingly reject cuts to Social Security and believe the wealthy don’t pay their share in taxes?

Or are the White House and the Democratic Party leadership trying to do damage control?

The first thing to consider is that Obama’s poll numbers have been sinking like a lead balloon, reaching a new low in November with an approval rating of only 37 percent. Though some polls suggest a small bounce back, there is no doubt his standing has been hurt. Worse, early polls on the 2014 elections suggest serious problems for Democrats; some forecast losses on the scale of 2010.

Three things appear to be responsible for these dismal numbers. First, despite reports of soaring stock markets, the 99 percent is still stuck in a pretty rotten economy. There aren’t enough jobs, particularly for young people, and many people have just given up looking for work. Meanwhile, the richest Americans are making out like bandits — their net worth has doubled in a mere decade. This rankles. Second, some Americans did not take kindly to the recent realization that the NSA has been spying on them with carte blanche. They had expected more from a constitutional lawyer in the White House and their loss of faith probably shows in the erosion of trust in the President. Third, Obamacare has offered something to piss off large chunks of the population, from its effed-up website to the monstrous problems, like balance billing and various insurance sector scams, it fails to address.

When trouble starts brewing, the rally-the-base strategy is an old one in Washington. Obama has shown that he is fully capable of beating the rhetorical drum on populist messages while signaling to wealthy centrist donors that they need not worry, because it’s mostly just talk. A new New York Times/CBS poll shows that the President has enjoyed a small uptick in his popularity ratings, which now stand at 42 percent approval. The numbers are now back to where they were before the healthcare rollout, though far from where they were a year ago. Could it be that the flurry of inequality discussions initiated by the President and many organizations connected to his administration, like the Center for American Progress, are having the desired effect?

“Forgive me if I think of St. Augustine’s ‘Lord make me pure, but not yet,’” says political economist Thomas Ferguson. “Anything that directs attention to inequality is welcome, but it’s awfully late in the game. We are short millions of jobs and youth unemployment is at horrific levels.”

As uninspiring as this situation may be, there’s a small silver lining. Every once in a while you have to actually match actions with words. Obama, we know, has long promoted the centrist desire to cut Social Security through various schemes like his favorite, the chained-CPI cut, which would prevent seniors from keeping up with rising costs. However, in the current budget negotiations, the President seems to have dropped that idea. This is good news.

The bipartisan deal announced on Dec. 10 (which has not yet been approved) would replace some unpopular spending cuts. But the deal contains plenty of ugly items, like cuts to the federal employee pension system, which hits workers on top of the pay freezes that hospital staff, food inspectors, and other vital public employees have already endured. Still worse, the plan is a mean-spirited kick in the shins to 1.3 million Americans who don’t have jobs: the agreement omits an extension of benefits for workers unemployed longer than 26 weeks. This bone-headed move is also a terrible drag on the economy because it impacts the ability of those people to pay for things like food, housing and so on, and hurts the businesses that provide them, which causes more layoffs in a vicious cycle. Estimates put the damage at hundreds of thousands of lost jobs and a drop in GDP growth by 0.2 to 0.4 percentage points. And to what end? Tax breaks for the rich. Happy holidays!

Unless something drastic changes, Obama’s economic legacy is becoming pretty clear: Since the financial crisis, ordinary people have watched their real incomes go down and their living standards depressed. Trickle-down Republicans shoulder much of the blame, but so do centrist Democrats who are pleased with the status quo that has rewarded them and keep piling on for more cuts in ordinary people’s pensions.

The public is still being sold a pack of lies which places blame for our economic woes on hard-working people rather than where it belongs — on Wall Street bankers and the politicians they have purchased to promote policies that deregulate businesses, crush unions, hurt workers and cheat taxpayers. We are told we must cut the federal deficit by reducing government investment instead of focusing on creating jobs. But by emphasizing deficit reduction instead of job creation, Obama has exacerbated income inequality and has allowed discredited economic theories to drive public policy. Mentioning to Americans in his speech that the deficit is shrinking doesn’t do much to dispel the memory of his much-reviled Deficit Commission, co-chaired by one percenters Alan Simpson and Erskine Bowles, the mouthpieces of Wall Street financier Pete Peterson, whose fondest wish is to kill Social Security.

Barack Obama is a man who surrounds himself with wealthy people who speak to the interests of the wealthy, not the common American. He proved this long ago, when he filled the airwaves with messages of hope and change while he made his first bid for the White House, and then, once ensconced in Washington, governed like a centrist as a little light went out in hearts across the land.

Americans should be glad about all the talk of inequality, but very wary of the actions that accompany it, particularly, as Steve Rosenfeld has pointed out, when the Obama White House helped create a framework of structural deadlines which will continue unless the Democrats can retake both chambers of Congress and the presidency and revise the law that keeps the budget process on GOP terms. 

If you want to fight for polices that give regular people a chance to succeed, you face a tsunami of political cash that continually drowns out your voice. On minimum wage, on social insurance, on fair tax policies, and on job creation, you have to be louder and more persistent than Mammon himself. We’ll know President Obama is serious about inequality when the White House moves forcefully to limit the influence of big money in politics, making it his priority, for example, to press for workable, timely solutions to the secret "dark money" from hidden donors that can sway elections, or any number of ideas which progressives have proposed to take on this corrupting force in our democracy.

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