Big Government Bailout Worked
Don’t expect to see a lot of newspapers and Web sites with this headline: “Big Government Bailout Worked.” But it would be entirely accurate.
The actual headlines make the point. “Demand for fuel-efficient cars helps GM to $3.2 billion profit,”declared The Post. “GM Reports Earnings Tripled in First Quarter, as Revenue Jumped 15%,” reported the New York Times.
Far too little attention has been paid to the success of the government’s rescue of the Detroit-based auto companies, and almost no attention has been paid to how completely and utterly wrong bailout opponents were when they insisted it was doomed to failure.
“Having the federal government involved in every aspect of the private sector is very dangerous,” Rep. Dan Burton (R-Ind.) told Fox News in December 2008. “In the long term it could cause us to become a quasi-socialist country.” I don’t see any evidence that we have become a “quasi-socialist country,” just big profits.
Rep. Lamar Smith (R-Tex.) called the bailout “the leading edge of the Obama administration’s war on capitalism,” while other members of Congress derided the president’s auto industry task force. “Of course we know that nobody on the task force has any experience in the auto business, and we heard at the hearing many of them don’t even own cars,” declared Rep. Louie Gohmert (R-Tex.) after a hearing on the bailout in May 2009. “And they’re dictating the auto industry for our future? What’s wrong with this picture?”
What’s wrong, sorry to say, is that you won’t see a news conference where the bailout’s foes candidly acknowledge how mistaken they were.
The lack of accountability is stunning but not surprising. It reflects a deep bias in the way our political debate is carried out. The unexamined assumption of so much political reporting is that attacks on government’s capacity to do anything right make intuitive sense because “everybody knows” that government is basically inefficient and incompetent, especially when compared with the private sector.
Government failure gets a lot of coverage. That’s useful because government should be held accountable for its mistakes. What’s not okay is that we hear very little when government acts competently and even creatively. For if mistakes teach lessons, successes teach lessons, too.
In the case of the car industry, allowing the market to operate without any intervention by government would have wiped out a large part of the business that is based in Midwestern states. This irreversible decision would have damaged the economy, many communities and tens of thousands of families.
And contrary to critics’ predictions, government officials were quite capable of working with the market to restructure the industry. Government didn’t overturn capitalism. It tempered the market at a moment when its “natural” forces were pushing toward catastrophe. Government had the resources to buy the industry time.
What’s heartening is that average voters understand that broad assaults on government provide better guidance for the production of sound bites than for the creation of sensible public policy. That’s why House Republicans are backpedaling like crazy on their plans to privatize Medicare — even as they pretend not to.
Conservatives really believed that voters mistrusted government so much that they’d welcome a chance to scrap Big Government Medicare and have the opportunity to purchase policies in the wondrous health insurance marketplace. Don’t people assume that anything is better than government?
But there were deep potholes on the road to a market utopia. Put aside that the Republican budget wouldn’t provide enough money in the long term for the elderly to afford decent private coverage. The truth is that most consumers don’t have great confidence in the private insurance companies, with which they have rather a lot of experience.
When it comes to guaranteeing their access to health care in old age, most citizens trust government more than they trust the marketplace. This doesn’t mean they think Medicare is without flaws. What they do know is that Medicare does not cut people off in mid-illness and that its coverage is affordable because government subsidizes it.
It’s axiomatic that government isn’t perfect and that we’re better off having a large private sector. It ought to be axiomatic that the private market isn’t perfect, either, and that we need government to step in when the market fails. The success of the auto bailout and the failure of the Republicans’ anti-Medicare campaign both teach the same lesson: The era of anti-government extremism is ending.
By: E. J. Dionne, Opinion Writer, The Washington Post, May 8, 2011
What Do You Mean We, White Man? Deficit Edition
Whenever I read pieces like David Brooks’s column this morning — pieces that attribute our budget deficits to the public’s irresponsibility and lack of realism — I find myself wondering how so much recent history went down the memory hole.
To be fair, polling on budget questions does suggest a popular demand that we repeal the laws of arithmetic — that we not raise taxes, not cut spending on any popular program, and balance the budget.
But if we look at actual policy changes, it’s hard to see that too much democracy was the problem.
Remember, we had a budget surplus in 2000. Where did it go? The two biggest policy changes responsible for the swing into deficit were the big tax cuts of 2001 and 2003, and the war of choice in Iraq.
And neither of these policy changes was in any sense a response to public demand. Americans weren’t clamoring for a tax cut in 2000; Bush pushed his tax cuts to please his donors and his base. And the decision to invade Iraq not only wasn’t a response to public demand, Bush and co. had to spend months selling the idea to the public.
In fact, the only budget-busting measure undertaken in recent memory that was driven by popular demand as opposed to the agenda of a small number of powerful people was Medicare Part D. And even there, the plan was needlessly expensive, not because that’s the way the public wanted it — it could easily have been simply an addition to traditional Medicare — but to please the drug lobby and the anti-government ideologues.
Now, a lot of historical rewriting has taken place — I’ve even seen pundits solemnly describe the Iraq war fever as an illustration of the madness of crowds, somehow erasing the fact that it was Bush and Rumsfeld, not the masses, who wanted the thing.
But the reality is that if you want to see irresponsibility and self-indulgence at the expense of the nation’s future, you don’t want to visit Main Street; you want to hang out in the vicinity of Pennsylvania Avenue.
By: Paul Krugman, The New York Times, Opinion Pages, May 6, 2011
Is Donald Trump A Demagogue?: He Might Aspire To Be One—But He Doesn’t Have The Chops
Unless you live under a rock, you know Donald Trump is thinking about running for president. His sensational public endeavors—pushing the White House to release President Obama’s long-form birth certificate and, most recently, questioning the authenticity of the president’s academic record—have met with astonishment, outrage, and dismay. A recent Bloomberg BusinessWeek cover featured a photo of Trump in mid-rant with the one-word headline, “Seriously?” Journalists, commentators, and even Jerry Seinfeld (who recently canceled an appearance at a Trump fundraiser) have taken to calling Trump a demagogue.
In recent decades, this powerful term, traditionally a scalpel for taking apart dangerous leaders, has become blunt and ineffectual through overuse. I’ve been thinking and writing about demagogues for a decade. I’ve been watching with a mix of bemusement and concern as Trump strains to elevate himself into an actual political figure, rather than the ego tornado he’s been for decades. But one of the lessons of history is that, while it’s easy to underestimate demagogues, it’s also easy to overestimate them. For the time being, I’ve concluded that Trump is not a demagogue. He lacks both the common connection and the lawlessness of classic demagogues, whether Venezuela’s Hugo Chavez today or, in the past, figures ranging from Benito Mussolini to George Wallace to Joseph McCarthy. Instead, call him a quasi-demagogue: a political figure with the desire, but not the chops, to manipulate the masses.
Demagogues are part of the natural life cycle of democracy. So much so that the Founding Fathers designed our various checks and balances and circuit-breakers in part from their mortal terror that a predatory mass leader—a demagogue—would convert popular adulation into American tyranny. James Madison, for instance, explained that “provisions against the measures of an interested majority,”such as an independent judiciary, were required to control “the followers of different Demagogues.” This doesn’t mean, however, that demagogues haven’t popped up throughout the country’s history.
During my years studying and watching demagogues, the one lesson that has stuck with me is this: Many politicians could become demagogues if they wanted to. They could choose the gross emotional appeal, the naked ambition, and the cunning blend of vulgarity and artistry that is the true demagogue’s métier. They don’t because most of them are governed by an ethic of shame. Where others blush and quail, the demagogue happily blusters ahead—crossing boundaries, coloring outside lines, toppling walls.
Demagogues often look most ridiculous to the people they’re most uninterested in impressing. When the colorful, autocratic Louisiana Governor Huey Long was sworn into the U.S. Senate in 1931, it was precisely his clownishness that gave him such political amplitude. He prompted a firestorm of controversy when he met a German naval commander paying an official call in a pair of green silk pajamas and a bathrobe. One scholar writes, “[T]he lesson he learned from the incident was less the importance of diplomatic niceties than the value of buffoonery in winning national publicity.” With these techniques, Long soon attracted more attention from the press than his 99 Senatorial colleagues combined. He would have challenged FDR for president in 1936, had he not been assassinated by the son of a political opponent in 1935.
You might think that Trump’s own clownishness puts him in the class of a Huey Long. But let’s take a closer look. As I argued in my book Demagogue: The Fight to Save Democracy from Its Worst Enemies, a true demagogue meets four tests. First, he presents himself as a man of the people, rather than the elites. Second, he strikes a very strong, even overpowering emotional connection with the people. Third, he uses this connection for his own political benefit. Fourth, he threatens or breaks established rules of governance. This fourth test is the most important, distinguishing a demagogue like Huey Long (who routinely used the National Guard to intimidate or brutalize political opponents, for instance) from populists like William Jennings Bryan (who, as rambunctious as he may have been, tended to play by the rules).
For Trump, let’s take the four tests in turn. With his Theater of the Absurd hairdo and his massively knotted silk ties, his Manhattan address and his glitzy brand, Trump is hardly a man of the people. True, he’s employing incautious bluster as a proxy for common appeal. “Authenticity” has become the coin of today’s reality-television realm, and there is a mass appeal to his straight-talkin’ persona—this is why his recent use of the “f bomb” plays to his curious political strengths, even while appalling elites. But for Trump to swap his fancy persona for that of a commoner would require him to blow up the brand he’s spent decades building, a task for which he is probably not constitutionally capable.
Second, Trump does not have the broad emotional appeal to the masses that marks the classic demagogue. Over the last decades, Trump has enjoyed billions of dollars of both paid and earned media exposure. He couldn’t be better-known by the American people. Yet he is consistently polling under 20 percent right now among Republicans and right-leaning independents (a recent CNN poll has him at only 14 percent), giving him a base of well under one in ten among the general voting population. The emotional surge for Trump among the very hard-core Tea Party right should certainly be noted. But it’s more likely this brushfire halts at a particular firebreak: the general American public’s hostility and suspicion to the Tea Partiers.
On the third test, it’s very unclear whether Trump is interested in actual political power, or just in increasing his personal brand and wealth. Even now, we can’t tell whether he will run—and keep running, after the glitz of the initial launch wears off—for president. Even if he gets into the race, will he slog through the hard work of an 18-month campaign, including getting on the ballot in all 50 states, participating in debates, developing policy positions? And, if he drops out, will he really have an interest in putting his shoulder to a real political end? Time will tell, but the initial signs are that this is mostly about Trumpery rather than government.
The most important test is the fourth—that demagogues, unlike populists, bend or break the rules. Trump clearly has no inhibition about lying for political benefit. But real demagogues go much further. Look at Joseph McCarthy, who used his selected issue of anti-communism to demolish people’s personal and professional lives. It’s hard to imagine that Trump really wants to encourage threatening behavior. But, if he ever started to ask his followers to test boundaries of lawfulness, to “challenge authority,” our hackles should quickly rise.
None of this means Trump isn’t worth taking seriously. To the contrary: Where Trump is succeeding in his demagogic appeals, he’s also illuminating shadowy corners of the American public. And we have to take a hard look at how this is happening. Demagogues, like nightshade, have always flourished in dark places of extreme economic or social distress. The 1920s were the last great era of American demagoguery, when Huey Long and the Detroit “radio priest” Father Coughlin rallied millions of terrified Americans against elites. It’s been no surprise that the 2010s, a time of similar distress, have fostered divisive figures from Sarah Palin to Glenn Beck to Trump.
The lesson here is that today’s restless, upset public needs reassurance—and vigorous economic policy that addresses their concerns. But we also need the media to exercise some discretion. In today’s fragmented, 24-7 echo chamber, where 500,000 nightly viewers qualify you as a pundit and one persistent blogger can take over a news cycle, the media has more responsibility for steering the ship of state toward calmer waters. Trump—as quasi-demagogue—is a creation largely of the media. The real conspiracy isn’t Trump’s mania du jour; it’s hundreds of news editors, assignment editors, reporters, and bloggers whom he’s playing like fiddles.
More broadly, though, history shows that the only real antidote to demagogues is an alert, vigilant civic culture. The ancient Athenians, exhausted by a series of vicious demagogues, passed a law exiling anyone who “proposed a measure contrary to democratic principles.” We probably don’t need to go so far, though some watching Trump today doubtless wouldn’t mind moving him to Canada. America, after all, is the land of the civic mores the visiting Frenchman Alexis de Tocqueville chronicled and admired. And we almost always eventually turn on demagogues. The stars of Father Coughlin, Joseph McCarthy, George Wallace, and David Duke all rose for a time, but, when they fell, they crashed hard.
We can never be complacent about our constitutionalism, and the Trump phenomenon bears careful watching, lest the little fires he’s clearly capable of starting spread into a larger conflagration. But, in general, Americans have shown they’ve got what it takes to nip even quasi-demagogues in the bud. Take note of Palin and Beck’s recent fates: Under heavy fire from the public for their own excesses (a persecution complex in Palin’s case, and anti-Semitic conspiracy theories in Beck’s), they both are retreating to the sidelines.
We’re early in Trump’s political career, so I offer these judgments cautiously, but my suspicion is that Trump, too, will burn out, like a hot fuse on a cold rocket. This may already have started. When President Obama took the stage last week in his stunner of a press conference to take on Trump’s birther attacks, he declared, “We’re not going to be able to solve our problems if we get distracted by sideshows and carnival barkers.” A hilarious tweet I received shortly after said that carnival barkers were protesting that the comparison with Trump was giving them a bad name. And, of course, the president easily made Trump look both inane and irrelevant when the coverage of Osama bin Laden’s death interrupted “The Celebrity Apprentice.”
There’s also a final thing Trump himself should remember, before he goes farther down what is likely a dead-end road to demagoguery: History remembers Joseph Welch’s famous question to McCarthy—“Have you no sense of decency, sir? At long last, have you left no sense of decency?”—as well as it remembers McCarthy himself. Trump has shown he doesn’t take criticism well, sending an angry retort to Vanity Fair and appearing openly thin-skinned after jokes were made at his expense at the White House Correspondents Dinner. He will likely realize soon, if he hasn’t already, that his brand, not to mention his ego, will not sustain the sort of historical thrashing that will inevitably follow any furthering of his demagogic aspirations. Indeed, in the end, The Donald’s self-love might just be his own best friend.
By: Michael Signer, The New Republic, May 7, 2011
The Most Under-Covered Success Story Of The Obama Era
About two years ago, NBC News establisheda tough benchmark: “As the GM bailout goes, so goes the Obama presidency.”
With that in mind, Jonathan Cohn offers us a helpful update on where things stand.
On Thursday General Motors announced that, for the fifth consecutive quarter, it had made a profit. And not just a measly one, either. The $3.2 billion was higher than experts had predicted and more than three times the profit of the same quarter in 2010, when the company was still struggling to emerge from its bankruptcy.
GM sales in North America were up 25 percent over that period. That reflects the recovery, obviously, but the increase in GM sales was still larger than the industry average. Even if GM can’t keep up that pace, it’s a sign of increasing health.
Still, the most interesting part of the news is not the profit itself. It’s how GM made it.
Right. After the federal intervention to rescue the automotive industry, GM shifted its focus, reducing excess capacity and developing a better lineup of fuel-efficient cars and crossover vehicles. It’s proven to be quite successful.
Cohn noted that GM recovery has not been flawless, and the transition has been painful for many. He concluded, however, “[I]f not for the Obama Administration’s intervention, the entire American auto industry might very well have collapsed and taken the Midwest with it. Instead, the industry is on the rebound, at least for now. That’s not bad for government work. Not bad at all.”
I’d just add, from a purely political perspective, that Republicans still consider this a failure. As far as the right is concerned, the Obama administration’s rescue of the American automotive industry wasn’t just wrong, it was one of the president’s most dreadful mistakes. Confront conservatives with reports like the latest from GM, and the response tends to be that the success of the policy doesn’t change anything.
The thesis about the right valuing ideology over practical results needs no better example.
By: Steve Beden, Political Animal, The Washington Monthly, May 5, 2011
Bin Laden Death Photo Coverage Is Media’s New Birther Moment
On Tuesday morning, counterterrorism official John Brennan was interviewed by NPR’s Steve Inskeep about the death of Osama bin Laden. For about eight minutes, listeners were treated to a serious and in-depth exploration of the circumstances surrounding bin Laden’s discovery and demise.
But then, right at the end, Inskeep couldn’t help himself. “In a few seconds, Mr. Brennan, why haven’t you released photos of Osama bin Laden?” Inskeep asked. Over the final minute of the interview, he repeated that important question four times.
And you couldn’t help thinking: Here we go again.
Wasn’t it just, like, hours ago that the media had assumed a posture of deep introspection about their role in fueling outlandish conspiracy theories?
On one hand, there were people like Shepard Smith of Fox News urging the media to “look in the mirror” because questions about President Obama’s birthplace were “a load of crap” and journalists “knew it from the very beginning.” (Amen.) On the other, there was Bob Garfield of NPR’s On the Media arguing that the attention paid by the media to Donald Trump’s birther claims was necessary to help the public distinguish between a “carnival barker” and a “responsible leader.” (Oh, I get it: Loons raise loony questions, the media repeats them over and over again, and, in so doing, exposes them to an audience far larger than the loons ever could have dreamed of reaching on their own, and thus we need the media to help us identify the loons. Wow, what an indispensible service.) No consensus, perhaps, but at least they were grappling with the question.
Not anymore, evidently.
Just hours after President Obama addressed the nation, no less than J. Michael Waller posted a blog entry opining that bin Laden should be displayed naked in lower Manhattan, then chopped into bits and dumped into the New York City sewers because while he may be dead “I’ll believe it when I see it.” Who’s J. Michael Waller you ask? Who cares! Questions have been raised! The public needs help identifying the carnival barkers! Summon the media!
So, there was Inskeep pressing Brennan. The Chicago Sun Times editorialized that a photo should be released to stop the conspiracy theories. The Associated Press moved a story headlined “Wanted: Visual Proof that the U.S. got him.” (Though you might reasonably ask why, given that the proof detailed in the story included DNA evidence, photographic identification, bin Laden’s wife apparently calling out to him by name during the firefight, and “[t]ellingly” an al Qaeda spokesman calling bin Laden “a martyr” and offering “no challenge to the U.S. account of his death.” Mighty suspicious!)
In fairness, there are differences between the birther stories and whether the United States should release a photo of bin Laden. To be sure, the latter has actual foreign policy and national security implications, and, now that the administration has decided not to release a photo, it may be that serious issues, rather than the increasingly hairbrained ideas of conspiracy theorists, will drive the media’s coverage but … I’ll believe it when I see it.
If the media would like us to believe it has serious, as opposed to sensationalistic, intentions when it covers a story like this, the nature of the coverage has to change. Raising a baseless charge again and again, day after day, and concluding that you’ve done your job if “both sides” of the story are represented does everyone a remarkable disservice. The reason: It gives the media’s imprimatur of legitimacy to a charge that is baseless, and it leaves the impression that there are two sides to an issue that is, in fact, indisputably settled.
Instead, if the media is going to give such issues any coverage at all, it should turn its camera in the opposite direction, focusing on the people who cling to preposterous beliefs and asking what that tells us about them, our culture, and our country. That may be a worthy journalistic pursuit, but we’ve seen very little of it.
Of course, there may be a bright side to all of this: The secret to getting media coverage has been revealed.
Therefore, I would like to announce the following: I believe the moon is made of elephants.
Media: Come and get me.
By: Anson Kaye, U.S. News and World Report, May 5, 2011
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